Report: Nukem legal saga turns nasty

Report: Nukem legal saga turns nasty

By Rob Crossley

June 16th 2009 at 1:20PM

Court papers expose one view of the Duke Nukem breakdown, alleging 3DR held an â??offshore accountâ?

Further lawsuit documents have exposed the strained conflict between publisher Take-Two and developer 3D Realms that took place behind closed doors.

New papers suggest that a growing internal rift between 3D Realms and Take-Two reached breaking point during negotiations regarding the development of an Xbox 360 edition of the now-cancelled Duke Nukem Forever [DNF].

Take-Two has also made an extraordinary claim in its lawsuit filing, alleging that 3D Realms has attained a “substantial amount of funds” deposited in an off-shore bank account which would have been appropriate in funding the development of the game.

In May it was revealed that 3D Realms had shut down development of Duke Nukem Forever, said to be due to lack of funding, during a time when the developer was in heated legal dispute with its publishing partner Take-Two.

Yet Take-Two has claimed in a recently-unearthed court document that it did not approve of 3D Realms’ decision to terminate development of Duke Nukem Forever.

Alleging that a contract had been established between developer and publisher to deliver Duke Nukem Forever “in a timely and successful manner”, Take-Two is now seeking $12 million in damages from 3D Realms’ alleged breach of contract.

Using 3D Realms’ legal name – Apogee Software – the court document claims:

“Apogee repeatedly assured both Take-Two and the videogame community that it would use its best efforts to complete Duke Nukem Forever [DNF] in a timely manner.”

“During the initial public announcement about DNF in April 1997, Apogee stated its intent to release DNF by mid-1998. It did not. In December 1999, Apogee made a public statement suggesting that DNF would be released in 2000. It was not.”

“Likewise, in December 2000, Apogee made a public statement suggesting that DNF would be released in 2001. It was not. In 2003, Apogee informed Take-Two that it expected to finish DNF by the end of 204 or beginning of 2005. It did not.”

The public documents were originally discovered by Shacknews. The documents are available here [pdf].

The strained partnership between the two companies finally fractured when Take-Two approached 3D Realms with an idea to develop an Xbox 360 port of the game as well as continue its work on the PC version.

“Rather than develop the Xbox 360 version itself or hire another developer to do so, Take-Two solicited Apogee about expanding Apogee’s current development of the PC version of DNF to include an Xbox 360 version,” read the lawsuit.

“The parties entered into negotiation at this point.”
It is at this stage where Take-Two claims that 3D Realms asked Take-Two to “fully fund” the studio to reach its targets in development of both PC and Xbox 360 editions of the game.

“In light of extensive delays in the development of the PC version, Take-Two was reluctant to lend Apogee such significant sums of money without reasonable assurances that Apogee would make timely and meaningful progress in the development of DNF,” read the plaintiff’s statement.

Take-Two then went on to claim that it offered to fund half of the "concurrent development" costs to the point where 3D Realms reached the project’s Alpha stage, while the other half was promised would be paid upon completion of the game. This is where negotiations broke down.

Of this turning point in the publisher-developer partnership, 3D Realms have vehemently contested this account of events. In a recent press release, the company alleged that:

“Take-Two was well aware that 3D Realms needed the funding to continue the DNF game development. Suddenly, after months of negotiations, Take-Two materially changed the parameters of the proposed funding agreement.”

“3D Realms informed Take-Two that it could not financially afford the changes Take-Two was suggesting and would be forced to release the team if an agreement was not reached. Take-Two made a last minute proposal to acquire the Duke Nukem franchise and the 3D Realms development team.”

“Take-Two's proposal was unacceptable to 3D Realms for many reasons, including no upfront money, no guarantee minimum payment, and no guarantee to complete the DNF game. From 3D Realms' perspective, we viewed Take-Two as trying to acquire the Duke Nukem franchise in a ‘fire sale.’”

In contrast, Take-Two has made an extraordinary claim in its lawsuit alleging that 3D Realms “has title to a substantial amount of funds deposited in an off-shore account,” which Take-Two believes Apogee can use to fund its outstanding obligations.

The Duke Nukem team was axed just days after negotiations collapsed. Take-Two has also made legal claims against 3D Realms for shutting down development. The publisher alleges that it had a contractual right to develop an Xbox 360 version of the game, which 3D Realms was obligated to provide source code to.

No verdict has been reached.