AllThingsD is reporting that Electronic Arts and Zynga have quietly settled their long-running lawsuit concerning their respective Facebook games The Sims Social and The Ville.
AllThingsD is reporting that Electronic Arts and Zynga have quietly settled their long-running lawsuit concerning their respective Facebook games The Sims Social and The Ville.
Microsoft is doing its best to erase a 56-page document detailing its plans for the "Xbox 720" off the Internet with a series of DMCA takedowns. The lengthy document was leaked onto the Internet over the weekend, and offered a glimpse into some of the things Microsoft might have planned for its next-generation system. If there was any doubt as to the document's authenticity these series of DMCA takedowns prove that Microsoft cares about it being read.
LA Times reporter Ben Fritz, who is in close proximity of the Activision v. West and Zampella court case happening in Los Angeles today has been furiously tweeting various scoops via his Twitter account. Among the revelations are that Los Angeles County Superior Court Judge Elihu Berle has denied Activision's motion to postpone the case for an additional thirty days. The trail will begin as scheduled on May 29.
California District Court Judge Susan Illston (San Francisco) denied Sony's request for "expedited discovery" this week, dashing the company's hopes that it could force technology companies to release information related to the George Hotz case. The company will have to wait until a hearing on March 11, 2011 at 9:00 a.m.
This means that, for the time being, Sony cannot send out any of the subpoenas to various tech companies such as Slashdot, Google, Twitter, etc. Sony had hoped to divulge the identities of hacking group Fail0verFlow's membership, which would allow it to add their names to the ongoing legal action against Hotz.
One document leaked by Wikileaks (from the U.S. Consulate in Shanghai) shows that at least some in the U.S. State Department might have a dim view of gamers. Buried in a leaked cable entitled "SHANGHAI SCHOLARS EXPRESS CONCERN OVER DELAY IN SIX-PARTY" (September 2008 ) is an interesting evaluation of North Korean Leader Kim Jong-Il's three sons and a mention of video games.
Amidst the details on six-party talks, Kim Jong-Il's health, the benefits of removing North Korea from the State Sponsors of Terror list, and "future leaders" of the country, is a mention of KJI's youngest son and his fascination with video games:
PalTalk Holdings Inc. of Jericho, New York has filed a patent lawsuit against a slew of massively multiplayer online videogame makers.
Filed on September 14 of this year, the suit targets Sony Computer Entertainment America, Sony Online Entertainment, Sony Corporation of America, Sony Corporation, Activision Blizzard, Inc., NCSoft Corporation, Jagex Limited and Turbine, Inc.
PalTalk alleges that the defendants all use PalTalk technology in an unauthorized and infringing manner and says it has “suffered damages in at least the tens of million of dollars” at the hands of each defendant. The company is seeking a jury trial.
In 2002 PalTalk purchased patented technology from HearMe that allows "efficient handling of communications between players necessary to maintain a consistent game environment for all players,” covering a “number of aspects of online gaming, including communications through a group messaging server.”
The case was filed in Eastern District of Texas Marshall Division, a region, according to Boston.com, known for being “plaintiff-friendly.” The site also notes that a similar lawsuit by PalTalk against Microsoft in 2006, for use of its technology in the Halo series, resulted in the software giant eventually licensing PalTalk’s technology.
GP has the full 16-page complaint in PDF form for your perusal here.
Mid-year documents filed with the Federal Elections Commission indicate that the video game industry is currently leaning to the Democratic side of the aisle when it comes to Congressional campaign donations.
ESA PAC, the political action committee of game publishers group the Entertainment Software Association, has disbursed $12,400 to Congressional candidates so far in 2009. All but $1,000 of those funds went to Democrats or Democratic PACs. Here's the breakdown:
The contributions will be used by recipients for the 2010 mid-term elections. South Dakota's Thune is the only Republican among those receiving ESA PAC money so far in 2009.
DOCUMENT DUMP: Grab a copy of the ESA PAC mid-year report here...
The Entertainment Software Association has filed a federal lawsuit against the Chicago Transit Authority, challenging a 2009 CTA ordinance which prohibits ads for games rated M (17+) or AO (18+) from appearing on its vehicles and facilities.
GamePolitics readers may recall that in April, 2008 the CTA ordered ads for Grand Theft Auto IV removed from buses even before the game was released. The CTA action followed local news coverage of a rash of shootings in Chicago.
Shortly thereafter, GTA IV publisher Take-Two Interactive sued the CTA, charging that the agency had broken a $300,000 contract for the campaign. The parties settled the case later in 2008, with the CTA granting T2 a six-week GTA IV ad run. However, CTA officials moved to block future ads for M-rated games by passing the new ordinance, which took effect on January 1st and prompted today's legal action by the ESA.
ESA boss Mike Gallagher commented on the lawsuit in a press release:
The CTA’s ordinance constitutes a clear violation of the constitutional rights of the entertainment software industry. Courts across the United States, including those in the CTA’s own backyard, have ruled consistently that video games are entitled to the same First Amendment protections as other forms of entertainment. The CTA appears unwilling to recognize this established fact, and has shown a remarkable ignorance of the dynamism, creativity and expressive nature of computer and video games. The ESA will not sit idly by when the creative freedoms of our industry are threatened.
The press release also explains some of the legal rationale behind the suit:
The ESA’s suit contends this new ordinance unconstitutionally “restricts speech in a public forum that is otherwise open to all speakers without a compelling interest for doing so.” In addition, the Complaint argues that the ordinance impermissibly discriminates on the basis of viewpoint and ignores less restrictive means of achieving the supposed ends of the ordinance.
The ESA also stated that the CTA’s ordinance is unnecessary because game-related marketing is already subject to the Entertainment Software Rating Board’s Advertising Review Council (ARC), which strictly regulates computer and video game advertisements that are seen by the general public. The Entertainment Software Rating Board (ESRB) assigns content ratings to computer and video games, which, in turn, are displayed on the advertisements for those games.
As GamePolitics has reported, the Massachusetts Bay Transit Authority has a similar ban on M-rated game ads, likening them to X-rated movies. It is unclear at this time whether the ESA will pursue a similar action against the MBTA.
While the lawsuit also encompasses AO-rated games, as a practical matter, such titles are virtually non-existent in the U.S. market.
DOCUMENT DUMP: Grab a copy of the lawsuit here (70-page PDF)...
A PlayStation 3 gamer has filed suit in U.S. District Court in California, alleging that SCEA suppressed his free speech rights and caused him pain and suffering by banning his account on the PlayStation Network.
In a complaint filed on July 6th, Erik Estavillo of San Jose writes that he his disabled by a variety of disorders; among these are agoraphobia, a fear of crowds:
The pain and suffering was caused by the defendant, Sony, banning the plaintiff's account on the PlayStation 3 Network, in which the plaintiff relies on to socialize with other people, since it's the only way the plaintiff can truly socialize since he also suffers from Agoraphobia...
Estavillo's issues with SCEA apparently stem from his play of the PS3 hit Resistance: Fall of Man:
The ban is supposedly due to the behavior of the plaintiff when he plays the video game "Resistance: Fall of Man," which Sony owns and employs moderators for its online play. These moderators kick and ban players that they feel are deserving; though their biases to a player seem to be what determines the kick or ban...
The plaintiff was exercising his First Amendment Rights to Freedom of Speech in the game's public forum when he was banned from, not only [Resistance], but also banned from playing all other games online via the PlayStation Network...
Estavillo also claims that the PSN ban amounts to a theft of his pre-paid points:
The plaintiff...cannot access [his] money when a moderator from Resistance and Sony gives a player a arbitrary wide-range ban... which in essence, is stealing money from the player...
Estavillo also argues that the EULA for online play of Resistance is ineffective in blocking players under the game's recommended age of 17, although it's unclear how this fits into his claim.
In his request to the court, Estavillo, who appears to be unrepresented, asks that SCEA be enjoined from banning players. He also seeks $55,000 in punitive damages.
To date, SCEA has not filed a response with the Court. GamePolitics has requested comment on the lawsuit from SCEA.
DOCUMENT DUMP: Grab a copy of Estavillo vs. SCEA here...
A University of Michigan economics professor estimates that Electronic Arts collectively overcharged Madden buyers between $701 million and $926 million during the years 2006 through 2009.
Dr. Jeffrey MacKie-Mason made his claim in a document filed last week with the U.S. District Court in San Francisco. Mackie-Mason was brought into the case as an expert witness by attorneys representing Geoffrey Pecover and Jeffrey Lawrence. The pair of gamers are named plaintiffs in a class-action suit alleging that EA used its exclusive licensing deal with the NFL to eliminate Take Two Interactive's competing NFL 2K series. The suit charges that EA then exploited the resulting competitive vacuum to dramatically raise the retail price of Madden.
While MacKie-Mason acknowledges that his estimates are based on incomplete data, he writes:
I provide this information for the limited purpose of allowing the Court to assess in rough terms the burden on Electronic Arts in relation to the magnitude of potential damages... Under California's antitrust statute, it is my understanding that these damages would be trebled.
MacKie-Mason arrived at the eye-popping figures using an estimated overcharge percentage that ranged from 50% to 66% for the 30.04 million units of Madden sold during the 2006-2009. He writes:
When Take-Two was able to compete unhindered, Madden NFL's competitive price was in the range of $19.95 to $29.95. I assume for this exercise that these would have been Madden's prices but for the alleged [monopolistic] acts.
Based on Mackie-Mason's estimate, attorneys for the plaintiffs have requested additional data for Madden sales going back to 2001. In a response, attorneys for EA agreed to supply as many of the requested documents as they could locate, but were unsparing in their assessment of Mackie-Mason's analysis:
EA respectfully submits that Dr. MacKie-Mason's analysis is fundamentally flawed on multiple levels. Indeed, Dr. MacKie-Mason's estimated magnitude of damages is nothing more than pure fiction - it has no basis in fact or law...
As GamePolitics reported last month, U.S. District Court Judge Vaughn Walker ruled that the plaintiffs' monopoly suit could go forward, but limited the scope of the case to claims arising in California and Washington, D.C. where Pecover and Lawrence reside.
Jack Thompson may have wowed the gamer crowd at SGC09 over the weekend, but Chief Judge Federico Moreno of the United States District Court for the Southern District of Florida appears to be decidedly less smitten with the disbarred attorney's act.
In a court order issued on June 26th, Moreno directed Thompson to explain why his October, 2008 disbarment by the Florida Bar should not also extend to Thompson's ability to argue before the federal bench.
"Wait," you're saying to yourself, "I thought Jack Thompson was already disbarred?"
That's correct. But Thompson has maintained for some time that the disbarment order of the Florida Supreme Court applies only to the state court system. Thompson has even taken to including verbiage to that effect in the headings of his e-mails, like the one below:
John B. Thompson, Juris Doctor
Once and Future Attorney
(address removed by GP)
Only Admitted to Practice in U.S. District Court, Southern District of Florida, Not Admitted in Florida
Despite Thompson's claim, Judge Moreno's order seems to indicate that Thompson's ability to function as a lawyer in federal court is, at best, on life support.
For his part, Thompson reacted with typical bluster to the Judge's order. For example, a July 2nd e-mail to Judge Moreno (cc'd to GamePolitics) demands copies of any communications concerning Thompson between the Southern District Court and the Florida Bar. In the e-mail Thompson seems to mock Judge Moreno and makes reference to being placed on a "terrorists watch list":
I make this request/demand because of your prior improper placement of me on a terrorists watch list in retaliation for my sending you a letter about judicial misconduct on your watch. Even the Deputy US Marshals thought that was absurd. They laugh now every time I show up at the courthouse asking, “Are you still a dangerous terrorist, Mr. Thompson?” Funny stuff.
Now you have entered a show cause order demanding that I explain why you should not disbar me from the federal court, and in doing so you have told me to spend at least $30,000 to make my case in producing documents all of which the Florida Supreme Court has and [can] give you free of charge...
If I get sent to Gitmo as a “terrorist,” then please send the stuff there. I’ll be facing Tallahassee in prayer several times a day as required.
If you are curious as to the "terrorist watch list" reference, as GamePolitics reported last year, Judge Moreno dispatched a pair of U.S. Marshals to meet with Thompson afer the embattled attorney wrote to the judge, complaining:
We find yesterday that enemy combatants at Guantanamo are to get more due process from federal judges than what I am to have. I guess my "mistake" was not killing 3000 people to make my point...
Shortly thereafter Thompson complained that he was stopped from entering the courthouse in Miami by security personnel and was only permitted to enter the building with an escort.
Thompson, whose petition to review his disbarment was denied by the United States Supreme Court earlier this year, has a separate case relating to the disbarment ongoing in the Southern District.
DOCUMENT DUMP: GamePolitics has obtained a copy of Judge Moreno's one-page order via public records request. Grab a copy here.
The conservative Eagle Forum has filed an amicus (friend of the Court) brief with the United States Supreme Court in support of California's 2005 violent video game law.
As GamePolitics reported last month, California Attorney General Jerry Brown petitioned the High Court to review a U.S. District Court ruling that the state's 2005 law blocking the sale of violent games to minors is unconstitutional. A three-judge panel of the 9th Circuit Court upheld the District Court decision in a February ruling.
The family values group, founded by conservative Phyllis Schlafly (left) in 1967, filed the brief on Monday. The document was authored by Andrew Schlafly, son of Phyllis and founder of Conservapedia (sort of the anti-Wikipedia). In the amicus brief, the Eagle Forum lays an array of societal problems at the feet of violent video games: bad grades, violent behavior, poor graduation rates, school shootings, game addiction and even sudden death.
We'll let the Eagle Forum's laundry list speak for itself (with a little help from GP's trusty red pen):
The First Amendment does not render our nation’s youth defenseless against the predatory, billion-dollar video game industry that churns out increasingly graphic blood and gore for impressionable minds to imbibe...
The corruption of our nation’s youth with increasingly deviant video games is a matter of national importance. Our nation’s youth is in crisis, by any measure. A calamitous 30% of our nation’s youth fail to graduate from public high school, and only 32% of those who attend public high school are ever qualified to attend a four-year college...
A substantial percentage of teenagers are hooked on these disturbing video games, and spend many hours each week playing them. Moreover, mass killings perpetrated by youngsters are frequently linked to addiction to violent video games...
The First Amendment does not forbid state legislatures from keeping this harmful material from children. The California legislature, not known to be conservative, protected its youth against the predatory video game industry. It was an error with national implications for the Ninth Circuit to invalidate the California statute...
Violent video games hurt children in two ways. Their increasingly realistic and disturbing images burn into children’s impressionable minds much as pornography does, and the role-playing inherent in a video game causes the child to buy into the rampages of murder and other heinous crimes that he is acting out...
The early market leader in video games was Nintendo, which adopted a policy against “excessive blood and violence,” but it was trounced in sales by a 3 to 1 margin by more gory material produced by Sega, and Nintendo learned the message that “violence sells video games to children...”
Numerous studies confirm the obvious: violent video games do cause addiction and harm... There has never been a full First Amendment right to flash highly objectionable and disturbing images specifically at children, or to entice them to participate in destructive role-playing behavior...
Displaying a shocking image to a child is conceptually identical to the utterance of “fighting words” to an adult, which this Court famously held to be out-side of First Amendment protection...
The stress attributed to violent video games can even be physically harmful. Eighteen-year-old Peter Burkowski, an avid video gamer, collapsed and died of a heart attack while playing games in an arcade...
Children who play violent video games have difficulty obeying authorities, treating peers properly, and succeeding in school...
DOCUMENT DUMP: Grab a copy of the Eagle Forum's amicus brief here.
Digging deeper into a court document filed on Friday by Duke Nukem developer Apogee Software reveals that - at least according to Apogee's attorneys - 2K Games is creating a new Duke Nukem property with the working title Duke Begins.
The following passage appears in Apogee's response to a suit filed against it last month by publisher Take-Two Interactive:
On October 22, 2007, Apogee, Take-Two, and 2K Games entered into an agreement in which Apogee granted 2K Games the exclusive right to develop and publish a new videogame based upon Apogee's Duke Nukem franchise... The new game was given the working title of "Duke Begins" and is not the same game as the DNF game...
The original development schedule for the Duke Begins game provided that the game was to be completed and commercially released by mid-2010...
Take Two and/or its subsidiary 2K Games halted or otherwise cancelled all development work by the third-party game developer on the Duke Begins game in April 2009... without Apogee's approval or consent...
When Apogee confronted Take-Two and 2K Games about the... cancellation of the Duke Begins development work... Take-Two and 2K Games simply denied it... Take-Two and 2K Games are taking such actions with a goal of pressuring Apogee to sell the Duke Nukem franchise rights to Take-Two for less than their true value.
DOCUMENT DUMP: Read Apogee's court filing here (20-page pdf).
UPDATE: GP spoke with a Take-Two representative who declined to comment, citing pending litigation.
An artist who creates custom designs for - among other things - motorcycles has sued Activision, The Discovery Channel and two other defendants in U.S. District Court in Manhattan.
In the suit filed on May 26th, artist Justin Barnes (left) alleges that he created a number of original designs for motorcycles constructed on The Discovery Channel's American Chopper series. Barnes claims that TDC in turn licensed the use of his work for a variety of merchandise, including video games, without his authorization. Barnes has copyrighted the works in question, according to his complaint.
Although Barnes accuses Activision, he does not mention a specific game. However, Activision has published two games based on the T.V. series, American Chopper in 2004 and American Chopper 2: Full Throttle in 2005; these would appear to be the games at issue in the case. From the complaint:
Defendant Activision has sold without authorization video games incorporating certain of plaintiff's copyrighted designs worldwide, nationwide and in the State of New York.
DOCUMENT DUMP: Grab a copy of the lawsuit here...
The New York Civil Liberties Union has filed a federal lawsuit claiming that the city of Troy, New York and its Public Works Commissioner suppressed free speech by shutting down a controversial video game exhibit in March, 2008.
GamePolitics readers may recall our extensive coverage of the politically-charged situation surrounding Iraqi-born artist Wafaa Bilal. His Virtual Jihadi exhibit employed a modded PC game which included a mission to blow up then-President George W. Bush. Bilal said that the exhibit was intended to express his view that U.S. policy in Iraq helped create terrorists.
Bilal, a U.S. citizen and a faculty member at the Art Institute of Chicago, was invited to display his work at Rensselaer Polytechnical Institute in Troy but was abruptly ordered off campus after the school's College Republican Club raised objections to the game. Bilal was then offered space to display Virtual Jihadi at a nearby gallery, the Sanctuary for Independent Media.
The gallery, however, was suddenly shut down for building code violations by Troy's Public Works Commissioner, Robert Mirch (left). Mirch, who is named as a defendant in the suit, had earlier led a demonstration protesting the exhibit. He called the suit politically motivated.
The Albany Times-Union offers comment on the suit from Melanie Trimble of the NYCLU's Capital Region Chapter:
City officials cannot selectively enforce building codes to shut down an art exhibition they find distasteful. Mr. Mirch abused his authority to suppress the free speech rights of people he disagree with, an unconstitutional act that must be challenged.
According to the Times-Union report, the NYCLU seeks a court order to block the city from using its building code to infringe on civil rights. The suit also seeks damages on behalf of the non-profit which owns the Sanctuary for Independent Media as well as for the gallery's executive director. The NYCLU has posted a press release on the suit.
DOCUMENT DUMP: Grab a copy of the complaint from the NYCLU website...
An expert on media law has told the Christian Science Monitor it is unlikely that the United States Supreme Court will accept California's petition to review the constitutionality of its violent video game law.
Dave Kohler (left), who heads the Southwestern Law School Donald Biederman Entertainment and Media Law Institute, told the CSM:
For a variety of reasons, I don't think [the Justices will] take [California's case]. The most significant one is the fact that if you apply this [violence] standard to video games, then you have to apply it to television, movies, and pay cable shows as well.
You're talking about the central topic of many of the great works of literature throughout history.
Aong that line, the CSM takes note of the 2001 ruling by Judge Richard Posner of the U.S. 7th Circuit Court. In striking down an Indianapolis game violence statute, Posner wrote:
To shield children right up to the age of 18 from exposure to violent descriptions and images would not only be quixotic, but deforming; it would leave them unequipped to cope with the world as we know it.
DOCUMENT DUMP: Read Judge Posner's decision in AAMA v. Kendrick.
Gamasutra reports that bankrupt Midway's unsecured creditors have banded together to bring suit against former owner Sumner Redstone (left), new owner Mark Thomas and several current and former board members. Among other allegations, the suit charges the defendants with fraudulent transfer, corporate waste, breach of fiduciary duty and unjust enrichment.
GamePolitics readers will recall that Redstone unloaded Midway to Thomas last November for the bargain basement price of $100,000.
The suit alleges that Midway's board of directors, most of whom had non-Midway business ties to Sumner Redstone, put the media mogul's interests ahead of those of the troubled game publisher in approving the deal. The 2008 fire sale to Thomas, the suit alleges, allowed Redstone to write off $700 million in losses, generating "a massive tax refund" and denying Midway the same tax opportunity. Redstone concocted the scheme to sacrifice Midway, the suit claims, in order to salvage the rest of his troubled financial empire, which includes CBS and Viacom.
The suit is unsparing in its criticism of new owner Thomas:
Thomas [was] completely unsuited to be the 87% owner of a publicly traded company... Thomas knew he was not an appropriate owner of Midway. He had no background in the video game industry. He had no assets to invest in Midway. Upon acquiring his controlling interest, he refused to speak with any officer or director of the company and even refused to disclose his middle initial so that an investigation could be made into his background.
More juicy tidbits:
The Redstone-Thomas transaction was completed in less than two weeks and the Redstone defendants kept the transaction secret from Midway's Board of Directors and management...
The... transaction gave Thomas a controlling stake in Midway worth tens of millions of dollars and the right to receive interest and principal payments on a $30 million secured loan and $60 million in unsecured loans... for a mere $100,000...
One business day before closing [the deal] after analyzing the litigation risks... [and] being told that [Redstone] would not give him an indemnity in connection with the transaction... Thomas transferred title and ownership in his house to his wife for $1...
DOCUMENT DUMP: Grab a copy of the lawsuit here.
The once-happy business union of Ultima series creator Richard Garriott and Korea-based MMO publisher NCsoft turned vicious at its end, according to documents filed by Garriott with U.S. District Court in Texas.
Kotaku broke the news of the lawsuit yesterday, but GamePolitics has the details - and they're ugly.
Garriott, best known for the Ultima RPG series, alleges that he lost millions when NCsoft manipulated him into cashing out stock options earlier this year after firing him late in 2008. Garriott's dismissal is news in itself, as his departure from the company was presented to the gaming community by NCsoft as voluntary.
From the complaint:
In... November 2008, Chris Chung, President of NCSoft's North American operations, informed Mr. Garriott that NCSoft has decided to "part company." Although Mr. Garriott objected to his dismissal, Mr. Chung insisted that the decision was final - Mr. Garriott had to go.
As Mr. Garriott prepared to leave NCSoft, however, Mr. Garriott learned that NCsoft had internally re-characterized his termination by Mr. Chung as a "voluntary" resignation... This mischaracterization had profound and detrimental effects on Mr. Garriott's stock options: if NCsoft terminated Mr. Garriott's employment (which it did) then the options - worth tens of millions of dollars - would remain in effect until 2011; but if Mr. Garriott resigned voluntarily (which he did not), then NCsoft might have terminated those options... within ninety days of his departure...
NCsoft forced Mr. Garriott into a Hobson's choice of exercising his options... and forced him to sell into one of the worst equity markets in modern history...
Garriott claims that he not only lost millions by prematurely selling his options, but also incurred hundreds of thousands of dollars in tax liability associated with the unwanted deal.
Garriott's well-publicized turn as a space tourist also comes up in the suit:
Following the lauch of the Tabula Rasa game, Mr. Garriott took a leave of absence... to pursue a different kind of launch... Mr. Garriott used the considerable media coverage surrounding his space-launch to publicize and promote Tabula Rasa for NCsoft. For example, Mr. Garriott send a coded message to the Tabula Rasa player base during his space launch...
NCsoft terminated Mr. Garriott's employment while he was still in quarantine from his space flight...
Despite Mr. Garriott's repeated objections, NCsoft refused to retract its misstatements regarding the nature of Mr. Garriott's departure and the cancellation of his stock options...
In his lawsuit, Garriott alleges breach of contract, fraud and negligent misrepresentation on the part of NCsoft. He clams to have suffered "more than $27,000,000 in actual damages."
DOCUMENT DUMP: Grab a copy of Garriott's complaint here.
An ugly court action is underway and it involves a pair of video game titans.
On Tuesday Valve filed suit against Activision Blizzard in U.S. District Court in Seattle. The suit alleges that Activision refused to honor an agreement to abide by an arbitrator's April 6th award decision involving a 2002 dispute over royalties.
The arbitrator in that case awarded Valve $2,391,932, an amount that Valve says is less than it sought, but which it will accept because both parties agreed to be bound by the arbitration process.
Activision, however, challenged the award, claiming that Valve had been overpaid by $424,136 in years past. For its part Valve alleges that Activision failed to properly raise this issue before the abitrator whom, the suit claims, refused to consider it for procedural reasons.
Against that backdrop, Activision cut Valve a check last week for $1,967,796 - the amount handed down by the arbitrator less the disputed $424K. According to Valve's suit, Activision said that it wouldn't pay the rest and if Valve went to court Activision would countersue. Valve has apparently called Activision's bluff and the parties are now once again at odds.
DOCUMENT DUMP: Grab a copy of the complaint...
UPDATE: The original 2002 lawsuit was not against Activision, but instead targeted Sierra in a dispute over licensing Valve games to cyber-cafes. Sierra was owned by Vivendi, so when Activision merged with Vivendi in 2008 it inherited the Valve case in the deal.
A New Jersey man filed a federal lawsuit this week against SCEA, SCEI and a number of individual attorneys. The suit, filed by Craig Thorner and his company, Virtual Reality Feedback, makes some very ugly allegations.
GamePolitics has obtained a copy of Thorner's complaint in which the inventor charges that SCEA, SCEI, PDP/Electro Source and several attorneys colluded to infringe on his controller feedback patents. In a 43-page complaint, Thorner spins a tale of high stakes corporate conniving and reveals a surprising degree of naivete on his part.
As alleged by Thorner, his misadventures with Sony began in 2002 during the famous Immersion vs. Sony patent trial. That case revolved around force feedback controller patents; Sony eventually wound up on the wrong end of an $82 million judgment. Thorner claims that during the lmmersion vs. Sony case he was approached first by Sony and then by Immersion. Acting without an attorney, he eventually licensed his patents to Immersion.
After winning the $82M against Sony, Immersion went after PDP/Electro Source with the same type of force feedback patent infringement claim. At this point, Thorner alleges, Sony was appealing the judgment against itself and PDP faced Immersion's new complaint. The two companies entered into "a joint defense agreement."
Ultimately, Thorner blew off his deal with Immersion and licensed his patents to PDP for $150,000. It's unclear whether Sony and PDP were really interested in Thorner's tech, or whether he was merely a pawn in their legal defense against Immersion. In either case, Thorner alleges that Sony's partnership with PDP was hidden from him in order to keep him from demanding a sweeter deal. Once again, Thorner acted without the benefit of legal advice:
Thorner was uncertain about the fairness of the PDP/Electro Source proposal, but could not afford to discuss his concerns with an attorney... Thorner replied to [PDP's attorney]... stating that he would accept PDP/Electro Source's terms if [PDP's attorney] agreed to assist Thorner with any differences he might have with Immersion and with a trademark cancellation proceeding.
Thorner alleges that, in an effort to conceal its involvement in the deal, SCEA surreptitiously wired PDP the $150,000 payment to pass along to him. A copy of the wire transfer placed into evidence appears to back up Thorner's version.
A new study claims that one in twelve (8.5%) of gamers age 8-18 shows signs of being addicted to their hobby.
The research, conducted by Iowa State University and the National Institute on Media and the Family, compared the young gamers' playing habits to the American Psychiatric Association’s list of symptoms of gambling addiction.
The 8.5% of study subjects who showed addictive traits indicated behaviors such as:
• Lying to family and friends about video game usage
• Using video games to escape from problems or bad feelings
• Becoming restless or irritable when attempting to stop playing video games
• Skipping homework in order to play video games
• Doing poorly on a school assignment or test because they spent too much time on games.
ISU Prof Douglas Gentile (left) commented on his findings:
Many parents have been worried about their children being ‘addicted’ to video games. While the medical community currently does not recognize video game addiction as a mental disorder, hopefully this study will be one of many that allow us to have an educated conversation on the positive and negative effects of video games.
NIMF president David Walsh added:
This study is a wake-up call for families. While video games can be fun and entertaining, some kids are getting into trouble. I continue to hear from families who are concerned about their child’s gaming habits. Not only do we need to focus on identifying the problem, but we need to find ways to help families prevent and treat it.
The ISU/NIMF study used data collected in a Harris Interactive Poll that surveyed 1,178 American youth, aged 8 to 18.
DOCUMENT DUMP: Grab a copy of the study here.
GP: Perhaps a small point, but the press release for this research continually refers to "nearly one out of ten" respondents being addicted to video games. However, the 8.5% addiction result determined by the research is actually much nearer to one in twelve (8.33%); we've represented it as such in this article.
UPDATE: Grand Theft Childhood co-author Dr. Cheryl Olson offers some criticism of the study methodology employed by Prof. Gentile.
A heavily-redacted statement filed last week by mysterious Midway owner Mark Thomas has been added to U.S. Bankruptcy Court records.
Despite the confidentiality edits, some interesting nuggets of information are contained in the document:
Unfortunately, the juicier bits appear to have been redacted, leaving us to wonder how - and by how much - Midway managed to overvalue the MK series; which companies have been bidding on Midway's carcass; and how Midway actually benefitted from being acquired for a mere $100K.
DOCUMENT DUMP: Grab the 44-page PDF here.
UPDATE: According to a report in the Chicago Tribune, a Midway spokesman insists that the troubled publisher has enough cash to make it to August, and possibly beyond.
Bailed-out insurer A.I.G. isn't the only in-the-toilet company doling out questionable bonuses to the very execs who ran it into the ground.
For example, there's Midway.
Ben Fritz, who pens Variety's The Cut Scene blog, reports that the financially-troubled game publisher tried to persuade the U.S. Bankruptcy Court to permit it to:
However, the government's Bankruptcy Trustee objected, noting that:
The Debtors seek authority to pay bonuses to a selected group of officers and managers which are four hundred percent greater than bonuses paid to the same group in 2008 when the Debtors were not before the Bankruptcy Court.
Given the current state of the general economy, coupled with historical data related to incentive bonuses paid by these Debtors, the Motion constitutes an outrageous request and is not justified by the facts and circumstances of the case.
DOCUMENT DUMP: Grab a copy of the Trustee's objection here.
UPDATE: The Cut Scene has posted an update indicating that Midway has yielded to the Trustee's objections. Its new bonus plan:
Terming it a "give away to trial lawyers," a conservative media watchdog group has called upon Utah Gov. Jon Huntsman (R, at left) to oppose HB 353, which is currently under consideration by the State Senate.
The measure would make retailers who advertise that they abide by age restrictions for video games and movies potentially liable under Utah's truth in advertising law. As reported on GamePolitics, HB 353 passed the State House by a 70-2 margin last week.
Derek Hunter, executive director of the Media Freedom Project, wrote to Huntsman yesterday:
In a state famous for hosting the Sundance Film Festival, amending the [law] to include [video game and movie] transactions would have a chilling effect on the film industry, as well as other retail businesses, and further damage an already ailing economy.
Specifically, the Media Freedom Project strongly opposes opening up businesses to lawsuits for underage video game or movie sales. This give away to trial lawyers won’t make kids safer, but will build in dramatically higher costs for small businesses who are already working on strategies to keep kids safe...
No crisis exists. Parents are not clamoring for government intervention into the lives of their children...
Should the Utah State Senate pass HB 353 (and they have until Thursday midnight to do so), it would be up to Gov. Huntsman to sign the measure into law or veto it.
Sourcewatch reports that the Media Freedom Project is an offshoot of Grover Norquist's Americans for Tax Reform.
GP: Especially fascinating about the Media Freedom Project's involvement is that they are a conservative group lobbying against a bill that was proposed by a conservative legislator, Rep. Mike Morley, in the most conservative of states, Utah. Moreover, the bill enjoys the backing of the ultra-conservative Utah Eagle Forum and was originally drafted by another conservative, disbarred Miami attorney Jack Thompson.
DOCUMENT DUMP: Grab a copy of the MFP's letter to Gov. Huntsman here.
As the Midway bankruptcy works it way through the court system, there has been more than a passing interest in Mark Thomas, the unknown who purchased the financially-troubled publisher from media mogul Sumner Redstone for a mere $100,000 last November. In addition to Midway, Thomas also acquired $70 million of Midway debt in the deal.
Since Midway declared itself bankrupt on February 12th, there have been assertions by some creditors that questionable dealings occurred in relation to the Mortal Kombat publisher's sale and subsequent bankruptcy proceedings. As GamePolitics reported last month, a court document alleged that, under certain conditions, Thomas stood to make a 30,000% return on his original investment.
And, earlier this week, GamePolitics broke the news that Sumner Redstone and his daughter Shari, who formerly served as Midway's chairperson, were subpoenaed for depositions which appear to be directed in part at probing their relationship with Thomas.
Now, Mark Thomas is fighting back.
In a court document filed yesteday, Thomas declares - under penalty of perjury - that he never met or spoke to either of the Redstones until he became aware of the opportunity to purchase Midway on November 14th, 2008. The deal closed two weeks later. Thomas also writes that he did not speak with them during the negotiations to buy Midway and hasn't spoken to them since.
Thomas declares that he was initially informed by one of Redstone's attorneys that Midway might be available. Thomas, a 52-year-old attorney, lives in Massachusetts, and writes that his personal net worth is in excess of $10 million and that he has no debt.
Thomas goes as far as to attach a resume, which lists jobs as far back as 1980. Currently he serves as Managing Director of Estabrook Partners, LLC, a private equity firm which he founded. Prior to that, his most recent position was with another private equity firm, Georgetown Partners, LLC in which Thomas held a 48% ownership position.
DOCUMENT DUMP: Get the Mark Thomas declaration here.
UPDATE: The Chicago Tribune has additional coverage on the Mark Thomas revelations.
Last month, GamePolitics broke the news that some creditors of bankrupt Midway were alleging that the recent sale of the financially troubled Mortal Kombat publisher was a sham.
In a document filed with the U.S. Bankruptcy Court, attorneys for certain of Midway's unsecured creditors charged that insider dealing had occurred between the former owner, media mogul Sumner Redstone, and the new owner, mystery man Mark Thomas. According to those allegations, Thomas, whose shell company, Acquisitions Holding Subsidiary, purchased Midway for a mere $100,000 in November, stood to reap a 30,000% return on his investment.
As of this morning, civil subpoenas have been issued for Sumner Redstone and his daughter, Shari, who formerly served as chairperson of Midway. Both are required to appear later this month for separate depositions in New York City. The Redstones will be required to bring documents, notes and e-mails relating to the operation of Midway as well as to their dealings with Mark Thomas.
So far, court records do not indicate that Thomas has been subpoenaed.
GP: It is important to note that these subpoenas are related to a financial dispute between creditors in Midway's bankruptcy case. They are not related to any type of criminal or government regulatory investigation.
Do you get the feeling that Midway's ongoing bankruptcy drama isn't going to end well?
Reports yesterday indicated that executives planned to either structure a reorganization or sell off the company's only major IP asset - Mortal Kombat. Guess which one of those will be easier to do.
But a filing by Midway's new owner seems just as alarming.
GamePolitics readers may recall our February 15th exclusive report on allegations of sleazy insider dealing in the Midway affair. At the time, some Midway creditors wondered who new owner Mark Thomas was and how he was able to purchase Midway from media mogul Sumner Redstone for a mere $100,000 in November.
Thomas, through his shell corporation, Acquisitions Holding Subsidiary, fired back in U.S. Bankruptcy Court on Friday. Midway, says AHS, is hemorrhaging cash and Thomas wants his investment collateral protected:
[Midway has] an immediate need to access and use AHS's Cash Collateral. Nor can it be disputed that, based upon the Debtors' 13 week forecasted Budget, [Midway is] hemorrhaging cash at an alarming rate. Indeed, the [Midway] Budget indicates that between February 9, 2009 and May 4, 2009, [Midway] will burn through approximately $12,392,598 in cash representing an approximately 75% depletion of its cash reserves...
The Objecting Noteholders have made several unsubstantiated and unsupportable accusations - none of which are true - regarding the relationship and transactions between Sumner Redstone and AHS' s principal Mark Thomas... each of those allegations is without merit...
The Limited Objection is replete with unsupported and, frankly, irrelevant factual allegations regarding the relationship between Mark Thomas and Sumner Redstone...
We asked Wedbush-Morgan analyst Michael Pachter to comment on Midway's situation:
Unfortunately, their low cash position, high debt load, and unforgiving creditors place them in the position of having to generate cash at a bad time, and it's always easiest to sell the assets with the most value.
I think it's premature to say that they are dead, but fair to say that a [potential] sale of Mortal Kombat will weaken them.
DOCUMENT DUMP: The AHS/Mark Thomas objection...
As GamePolitics has previously reported, Jack Thompson is challenging his lifetime disbarment by taking his case to the U.S. Supreme Court.
Thompson was disbarred last October by the Florida Supreme Court. The Court was acting upon the recommendation of Judge Dava Tunis who Tunis presided over a nine-day trial on misconduct charges brought by the Florida Bar in late 2007.
Last month, Thompson filed a petition for a writ of certiorari with the U.S. Supreme Court, essentially an appeal. To decide whether cert petitions go any further, the Supreme Court Justices vote in private conference. If four justices vote for Thompson's petition, it will move on in the process. Without four votes, the case goes no further. At that point, Thompson would seem to have exhausted his options.
According to the SCOTUS docket, Thompson can expect a decision on his cert petition by March 25th.
GamePolitics has obtained a copy of Thompson's cert petition from the Florida Bar. We requested a copy from Thompson, but he declined to provide it.
For those who have followed the long-running Thompson saga, there's little in the cert petition that hasn't been heard before. The disbarred attorney blames the usual suspects for his troubles: Take-Two Interactive, the video game industry, the Florida Bar and its supposed "radical gay agenda," law firm Blank-Rome, Judge Moore from Alabama (who threw Thompson off the Devin Moore case), shock radio, the justices of the Florida Supreme Court and, of course, Judge Dava Tunis.
DOCUMENT DUMP: Grab your copy of Jack Thompson's cert petition here.
He wasn't on hand to testify and his name wasn't mentioned, but the influence of disbarred Miami attorney Jack Thompson was apparent in yesterday's meeting of the Business and Labor Committee of the Utah House of Representatives.
By a 10-3 vote, committee members approved H.B. 353, a bill drafted by Thompson and sponsored by Rep. Mike Morley. The measure targets the video game and film industries by amending Utah's current Truth in Advertising law. Retailers and movie theaters which advertise that they don't sell M-rated games or R-rated movie tickets to underage buyers and then do so would be liable for fines of $2,000 per incident.
Those testifying on behalf of the bill included Alan Osmond, the most senior of the Osmond Brothers vocal group and Gayle Ruzicka, the politically powerful head of the ultra-conservative Utah Eagle Forum.
For his part, Osmond, read into the record verbatim passages from an e-mail circulated earlier yesterday by Thompson. Osmond, however, did not identify Thompson as the author:
This link shows a montage of sex scenes from the Grand Theft Auto IV game which has been sold and is presently being sold at BestBuy.com, WalMart.com, Target.com, GameStop.com, and at other retailers’ sites, with no age verification whatsoever.
As you can see, there are graphically depicted lap dances in a “gentleman’s club” in this game, including simulation of oral/anal sexual intercourse between women. The hero in the game then has intercourse, clearly depicted... The hero then kills the woman by gunfire and running her over with his car.
Now that’s entertainment...
Utah must do something about these major retailers who are flat-out lying to the public when they assert they are not selling this and other similar pornographic “games” to kids when in fact they are...
Conservative power broker Gayle Ruzicka also testified on behalf of the bill with a Thompson-esque flavor, mentioning Devin Moore, the GTA-playing Alabama teen who murdered three police officers in 2004. Thompson, representing the officers' families, subsequently brought suit against Rockstar Games, Sony and others before being thrown off the case by an Alabama judge for professional conduct violations in November, 2005.
For those familiar with Thompson's anti-GTA crusade, Ruzicka's testimony had a familiar tone:
These [games] are the kind of things that are training our children. This is the vile stuff. The Grand Theft Auto games are cop-killing murder simulators. And when [Devin Moore] was faced with being arrested he knew exactly what to do. He knew how to aim... at the head and each time killed these [officers]. We don't want this for our children. Not at all. Please, please vote yes today on this bill.
Anything we can do to protect our children from the violence, from the filthy pornography that the only way they can get into the pornography is being good at the game. They work hard and get to certain levels and when they get to the high enough levels then they get into the pornography - filthy, vile stuff that you would be appalled and never want your children to see. And then as a reward, they get to kill the women...
Dick Cornell of the Utah Association of Theater Owners was among those who testified against the bill:
As GamePolitics reported in January, disbarred Miami attorney Jack Thompson hopes to have his professional status reviewed by the U.S. Supreme Court.
To that end, Thompson filed a petition for writ of certiorari with the U.S. Supreme Court late last week.
Thompson nonetheless faces an uphill struggle. According to its website, the Supreme Court receives petitions to consider about 10,000 cases per year. Only about 100 of those will be granted a hearing.
DOCUMENT DUMP: You can grab a copy of the certificate of service for Thompson's cert petition here. We do not have the actual petition at this time, although we are working to acquire it.
UPDATE: According to the SCOTUS docket, Thompson is due to receive a response to his petition on March 25th.