Founders Update: March - Legal stuff

Hi gang,

This is covered under your NDA.  I want to give you guys who are interested a non-lawyer, non-PR update on events.

As some of you have heard, things between Stardock and Paul and Fred have gotten very ugly.  As someone who was a big enough fan to approve investing millions of dollars to revive the franchise that they first designed, this has been pretty soul-crushing on a personal level.

So what the hell happened?  Below is my best effort to summarize what happened.  Usual disclaimers apply (that whole "to the best of my knowledge and belief" and what not)

This is very, very long. I'll break it into chapters.

In the beginning...

Up until this Fall, things between us were very amicable.  We would give them updates and they would respond with positive encouragement.  As the Super-Melee beta got closer, I asked if we could do a special license just for the ships to be in Super-Melee (i.e. a very low royalty proposal) which they politely declined and told us that they were planning to announce a sequel to the adventure from Star Control II.

While I was not thrilled at the idea of both games being in the public eye at the same time, we were still very excited because it would allow us to point fans who wanted to see the old alien stories continued to their game and take the pressure off of us to incorporate it into Origins and its sequels.

Unfortunately, things quickly went south as it became apparent that we had very different views on what rights each side had.  We thought this had been settled years ago when we told them what rights we had and they seemed to confirm it.  They owned the IP they created and we had a license to use it if we wanted but had declined in deference.  

As I pointed out to them, that disagreement was academic and we could simply create a new document that codifies that we wouldn't use their IP without a new license and they would allow us to review their announcement on the new game to avoid any confusion in the eyes of consumers.

Unfortunately, they rejected this and their view seemed to be that they wouldn't discuss anything, even by phone, unless we first agreed with their point of view.  Our view was that that disagreement was academic since we weren't actually exercising any of those rights and were willing to write up a document that would, in essence, provide everything they wanted provided that their new game not create confusion or split the fan base. 

Not only did they reject that but they demanded we rename Super-Melee to something else (which we complied, despite them having no legal right to any trademarkable items within the games).

Ghosts of the Precursors is announced

So then they announced Ghosts of the Precursors as a direct sequel to Star Control leading many many examples of it being called "Star Control: Ghosts of the Precursors" and some fans asking for refunds of Star Control: Origins and others saying "Finally, a REAL Star Control game".

Nevertheless, as many saw, we still showed public support for their efforts. 

Behind the scenes, we were trying to work out a coexistence agreement.  And this is where things became impossible for us to agree.

I couldn't discuss some of this before because we were certain most fans would be incredulous for us to suggest the position they've taken on the IP. However, their latest "settlement" offer makes their view very clear so we can now discuss it:

They believe that are personally entitled to the good will and reputation of the Star Control classic games and believe that the only rights we have is to name a game with the words "Star" and "Control" put together and thus we were attempting to "trick" fans into believing the new Star Control game is associated with the classic games.  

In addition, they believed they had the right to begin inspecting Star Control: Origins complaining about features such as the ship designer, the look of various ships, the fan art people were posting, the nature of the background of Star Control itself.

The problem with these two positions is that they have no legal basis for it.  We own the Star Control trademark.  The reason there was a bidding war that reached $300,000+ at the Atari auction is because of the reputation and good will associated with the classic games.  The new Star Control game IS part of the same franchise as the classic games.  They are, quite literally, related.   

Secondly, they have no legal standing to complain about things like ship designer or fan made ships or what have you for a number of reasons that I suspect you can guess.

They want private builds of Star Control: Origins to look for infringements

At this point, we were very concerned because if they believe they have the right to nit-pick Star Control: Origins of major features like the ship designer and Super-Melee, what else might they begin to insist they own that they have no legal standing to claim?

Still, at this point, it was academic.  They were making Ghosts, we were rejecting their demands for us to make further changes to Star Control: Origins and the classic games were on Steam and GOG for sale selling whatever tiny numbers they sell.

The public attacks begin

Then they began to publicly attack us, ostensibly because the DOS games were now on Steam without their permission.  The funny thing about that is that the games had been on GOG for years so what does it matter? They get paid royalties either way.

Well, Paul and Fred's position was that they were the ones who had the agreement with GOG and not us.  Now, this was news to us because we have in our possession an agreement between Atari and GOG for distribution of that and I have an email (that is publicly available) from 2013 that makes it clear that we believe we have the rights to sell and distribute the classic games that Paul acknowledged.  If he disagreed, then 2013 would have been the time to say something.  Not 4 years later.

The problem with their position is this: If the agreement is between them and GOG (and that does appear to be the case) by what right are they doing that?  Even if the Accolade licensing agreement expired, that doesn't confer upon them the right to sell Star Control.

For example, we make a product suite called Object Desktop.  Nearly every component in it is licensed from third-parties that work at our direction in exchange for royalties. Sound familiar?  Now, let's say that those licenses expire. That doesn't give any of those developers the right to start selling Object Desktop on their own, let alone claim to be making a sequel to Object Desktop.

Still, at this stage, we are trying to gently respond to them and hope that they will knock it off.

DMCA and the lawsuit

The DMCA was the last straw.  They actually got the Star Control 1, 2, 3 games taken down for a short time from Steam and GOG during the Christmas sale.  

Now, for Star Control I and II at least they worked on those.  But Star Control III was really pushing it as they weren't involved but they do have some, unspecified licensed IP in it (i.e. the breadth of we don't know but I think we can all agree there is licensed IP in SC3).

Since they didn't hold a copyright (they finally filed something at the end of December) their DMCA take down failed.

That was the last straw.

The scary part

Consider this: That they were willing to issue a DMCA take down of a game purely because it contained IP they believe is theirs means there is every expectation that Star Control: Origins could be subjected to it as well.  

They had already demanded we take out certain ships, the ship designer, the little do-dads in the background of the Tywom, Super-Melee, etc.  

Now, imagine Star Control: Origins comes out and they decide that they believe that the game having planet classes like Chondrite violates their rights? Or they don't like that the Precursors are a major element of our story? 

They have no legal standing to complain about this but we have already seen they are willing to issue DMCA take-downs and make public attacks on us.  Imagine if they did that during the launch of Star Control: Origins.  

Since they weren't willing to pick up the phone and talk to us and their lawyer explicitly stated they had no interest in coming to a coexistence agreement with us, our only venue left was the courts.

Stardock's complaint

In essence: Don't associate your game with Star Control and compensate us for the damage you have already done.  

Paul and Fred's response

In essence: Star Control's trademark should be canceled and Stardock should be punished for distributing the DOS games on Steam.

It gets ugly

So at this point, things get really ugly.  Paul and Fred hire a Crisis PR firm that begins putting out press releases, attacking us on social media.  And while we can't prove it, a lot of brand-new accounts on social media (like Reddit) begin to show up attacking us as well.  

As it got ugly, the lawyers recommended that we trademark Ur-Quan Masters to prevent Paul and Fred from doing so and ejecting us from the UQM community (luckily we did because Paul and Fred did attempt to trademark it and they did so before they could have known we had done so first).

After they tried to cancel our Star Control trademark (do you guys understand how much of a "go for the jugular move" that is?  That's basically like setting fire to the house we just paid a lot of money for) we concluded that there is no way we are going to get them to voluntarily coexist with us.  Therefore, we made the decision that there would only be one Star Control universe and the Ur-Quan, Spathi and other aliens that people associate with Star Control would be in that and if Paul and Fred want to make a game that uses them, it needs to be under our review.

Settlement shenanigans

The court instructs the lawyers to discuss a settlement and they do.

Stardock's goal is: We don't ever want to go through this again and we want any game that is going to potentially be associated with Star Control that they want to do in the future to be reviewed by us. and we want them to compensate us for the damage they've caused.

Paul and Fred aren't some poor, indie developers.  Paul Reiche III is the President of the Activision studio, Toys for Bob.  They are industry veterans with the means to hire a personal crisis PR firm.  

We expect them to compensate us in some form for the damage they've done.  We didn't start this.  We didn't want this.  But I think most people would agree that they've shaved several percent (at least) of the sales of Star Control: Origins through their actions.  That comes out to millions of dollars.

So their lawyers and our lawyers debate on how to make that square away.  Now, at this point, Stardock is not looking very kindly on Paul and Fred.

Stardock proposes a settlement in which most of the financial damage is mitigated by buying any rights Paul and Fred claim to the old IP.  This would prevent them in the future from meddling in our Star Control games.  We don't need their cooperation to have the Ur-Quan and such in future games so it's not about the aliens.  It's about keeping them from endlessly attacking us or suing us on Star Control related things.

They misrepresent our position as demanding an apology and them "surrendering" their rights and what not.  

They in turn send out a proposal that we just find unworkable which they also completely misrepresent.  The fine print would allow them to endlessly nit-pick at Star Control and demand that we not associate Star Control with (I kid you not, read it yourself) Star Control (the classic games).  

If someone says "You guys are trying to benefit from the good will and reputation of the Star Control games!" our answer is: Yes.  That is exactly correct.  That is the point.   The whole point of the project is to revive the Star Control franchise that people know and love.  And we were willing to do it even without the old aliens to make Paul and Fred happy (and anyone who says we couldn't do that, they are dead wrong and future Star Control games will have them).

My apologies to all of you

First of all.  I am sorry.  I apologize to all of you.  Bringing Star Control back was supposed to be a wonderful thing for everyone.  And Paul and Fred bringing out Ghosts was supposed to be like a super-bonus power up awesome.   That's how it was supposed to go.  That's what we wanted.

Moving forward

The bright side is that we are more motivated than other to deliver to you guys an amazing new Star Control game.

Below are some pictures from recent weeks:

Reaching a Smuggler's hide out.

Organic world.

Updates to Fleet Battles are coming.

Auto Pilot has arrived.

I'll be around if you have any questions or thoughts.