Trouble in Paradise

Icarus

Icarus

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[br]This morning Gamespot was able to dig up a little known lawsuit between Valve and Vivendi Universal Games.
"Valve sued Vivendi for copyright infringement back in 2002 over their unauthorized distribution of our products to cyber cafes," Lombardi told GameSpot last Friday. "We later had to add breach of contract claims for, among other things, refusing to pay us royalties owed and delaying Condition Zero out of the holiday season." [br]
[br]
That lawsuit became more complex when Sierra fought back with a counterclaim. "Almost a year and a half into the lawsuit," Lombardi continued, "Vivendi responded by making a number of claims in an attempt to invalidate our agreement and be awarded the ownership of the Half-Life intellectual property. We expect to prevail in this lawsuit."
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[br]You can read the full article here.[br]
[br]
Thanks goes to forum member "Netherscourge" for posting the information in this thread.
 
;)

I doubt it'll be anything to be significantly worried about though, as it's been going on since 2002.
 
valve are still gonna be kings of world when hl2 comes out. i think the law suit is irrelevant to any form of release date.
 
this is not frontpage news at all...it's nothing more then a stupid thread on this board imo...not relevant at all and ment to shock and give the people some sensation
 
I just hope VALVe wont use this as an excuse for further delaying HL2. Interesting none the less.

iF.
 
ferd said:
this is not frontpage news at all...it's nothing more then a stupid thread on this board imo...not relevant at all and ment to shock and give the people some sensation
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What are you talking about? This is industry news, this will help explain alot of things to people (it confirmed suspicians I already had), it is worthy of front page news here.
 
I bet this is why Valve wanted the Steam...that way if Vivendi tried to screw 'em over (cant see why they should, they would profit from HL2 release) Valve can still release HL2 over the net and keep some of the fans hapy - build up a bit of capital etc so they dont lose all cred thnx to VU screwing 'em over.
 
Actually, this is a GOOD thing for us. Think about it. . . whats the best way to screw VU?

Why, release your sure-fire mega blockbuster of a game on your own distribution system BEFORE it hits store shelves.

thats what id do, anyways
 
Dirk Pitt said:
Actually, this is a GOOD thing for us. Think about it. . . whats the best way to screw VU?

Why, release your sure-fire mega blockbuster of a game on your own distribution system BEFORE it hits store shelves.

thats what id do, anyways
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... And then through possible technicalities in your contract you get into alot of legal trouble causing alot of future problems for the players.
 
During the parties' negotiations...Counterclaim Defendants [Valve] repeatedly and falsely assured Sierra and VUG that retail sales would remain "the key to [their] strategy." In September 2000, for example, Newell told Hubert Joly, then VUG's CEO, that "online is a way to nurture the retail business" and that he "could not understand how one can make money online today."
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Why does everyone here think valve is so innocent?
 
deep8832 said:
Why does everyone here think valve is so innocent?
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Because Vivendi has pulled alot of crap in the past, and in my opinion we have more reason so far at least to believe that Vivendi is more in the wrong than Valve.
 
Hey guys, I emailed Gabe asking if he could add some clarification if this will impact release dates. Just an FYI. I have not gotten a response back. I most likely wont get one, if I do I will post it here.
 
i don't understand some of your points. you want valve to screw over their publisher by releasing it over steam? Ive always wondered about steam. i though vivindi financed hl2 to a large degree, and with the game already being a year late, its costing alot more. from their point of view, they see anyone who buys hl2 over steam, and not from a retailer, as stepping on their business, plus the business of the retailer.
thats another important point. Vivindi doesn't just release hl2, they handle many other forms of medium, and they make profit, but also make money for people who sell the games/music at a retail level. When your bargaining for shelf space for your product(games and movies) you need as much leverage as you can get. the most anticipated game ever being offered online, technically before the game is even released, would severly infringe on vivindi's and the retailers proffits.
I was always under the assumption that if you purchased off of steam, that vivindi would still make their profitt, and that valve would mail you a hard copy of the game as well. I was planning on preloading from steam, and sending in my voucher also to get my boxed version of the game. I hope i can still do that, if not, i want the extra money i spent on my video card for the version with hl2 back from vale. i think it was like 30 bucks or something
 
talk about pouring cold water on the hype train.. :|

deep8832 said:
Why does everyone here think valve is so innocent?
Click to expand...

because of what Mully just posted above.. and its a well known fact that publishers continuely try to screw the artists (in this case Valve) and well i guess pple here (myself included) feel this is another publisher trying to do the same thing.
 
Interesting comments . . .

On Friday, when asked if Valve was remained intent on making Half-Life 2 available to gamers via Steam, regardless of what was determined on October 8, Lombardi replied, "Yes."

(Taken from Bluesnews)


While Lombardi may have every intention in the world of distributing HL-2 via Steam, it's a legal and not a business question. If Vivendi makes a request to the court that Valve not distribute HL-2 via Steam because the legal status of HL-2 and its distrubution is in question, then that's that for HL-2 on Steam until the court decides HL-2's legal status (read: March '05 or beyond) Whether Vivendi would want to slit its own throat and poison the relationship between its self and Valve is another question altogether.


I do not believe there would be an impact on HL-2 normal retail channel sales as a result of a request for a ruling on Steam's legal status.


In fact, if the legal rights to HL-2 are in question and under challenge, then the 10/8 hearing is critical to the release date of HL-2. Valve expects rulings in favor of them, but doesn't say what will happen if the court sees things the other way. I have a feeling that HL-2 will be "gold" after the ruling, in either case.


From Gamespot:

That lawsuit became more complex when Sierra fought back with a counterclaim. "Almost a year and a half into the lawsuit," Lombardi continued, "Vivendi responded by making a number of claims in an attempt to invalidate our agreement and be awarded the ownership of the Half-Life intellectual property. We expect to prevail in this lawsuit."


After reading Vivendi's filing, I have to say that's a huge bit of hopeful thinking on Lombardi's part. Looking at Vivendi's counter-suit, it looks like Vivendi has ample ground for breach of contract, invalidating the 2001 agreement awarding HL-2's IPR to Valve. At minimum, there's cause, and IMHO(IANAL), a whole lot of cause to rule against Valve and for Vivendi.


This is not going to be resolved quickly. Vivendi looks like they have a damn good case and it looks like some REAL shady dealing on the part of Valve. Personally, I do not see how any court would be able to say Valve acted in good faith when they were developing Steam. I hope Valve has some damn good lawyers, because they're fighting the uphill on this one.


(Side note: this case will also have a direct impact on the Apple Computer vs. Apple Record lable case, or visa-versa, since it involves the exact same issues. If Apple v. Apple is resolved before V. v. V., expect the judge to use A. v. A. as precidence)


nb: IANAL.
 
DiSTuRbEd said:
Obviously not lazier than you, he has a company, you have? Oh wait nothing.
Click to expand...

And you know this how?

DiSTuRbEd = Rabid Fanboy with grasping attempt at profiling someone he can't possibly know.
 
greymann said:
And you know this how?

DiSTuRbEd = Rabid Fanboy with grasping attempt at profiling someone he can't possibly know.
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You could be Bill Gates or some multi-billion dollar man yes. However 99% of the time that is not the case and that you don't own a major company.

StukaFox said:
That lawsuit became more complex when Sierra fought back with a counterclaim. "Almost a year and a half into the lawsuit," Lombardi continued, "Vivendi responded by making a number of claims in an attempt to invalidate our agreement and be awarded the ownership of the Half-Life intellectual property. We expect to prevail in this lawsuit."


After reading Vivendi's filing, I have to say that's a huge bit of hopeful thinking on Lombardi's part. Looking at Vivendi's counter-suit, it looks like Vivendi has ample ground for breach of contract, invalidating the 2001 agreement awarding HL-2's IPR to Valve. At minimum, there's cause, and IMHO(IANAL), a whole lot of cause to rule against Valve and for Vivendi.


This is not going to be resolved quickly. Vivendi looks like they have a damn good case and it looks like some REAL shady dealing on the part of Valve. Personally, I do not see how any court would be able to say Valve acted in good faith when they were developing Steam. I hope Valve has some damn good lawyers, because they're fighting the uphill on this one.
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Considering the only information we have is from Vivendi's side I can't say that Vivendi could have a solid case yet. Of course Vivendi is going to paint Valve as the devil of the business world, and they could make it sound as plausible as they want since they have access to as many high priced lawyers as they want. I sure as hell won't form any opinion until I hear more of Valve's side of the argument.
 
greymann said:
DiSTuRbEd = Rabid Fanboy with grasping attempt at profiling someone he can't possibly know.
Click to expand...

Ahh I see you're a hypocrite. Nice job.
 
In 1997, Valve and Sierra entered into two agreements whereby Valve undertook to develop certain computer games and Sierra undertook to manufacture, market, and distribute the games. Among other benefits, these 1997 agreements granted Sierra intellectual property rights in the games.
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Translation: Valve was new to the industry and forced into a position where they lost the copyright. It happens to almost everyone new to a variety of industries.
"Beginning in 1999, following the success of its first game, Valve began to threaten Sierra that it would halt or slow development of the remaining games it was obligated to develop unless Sierra relinquished certain rights under the 1997 agreements. Sierra eventually capitulated to these demands and, relying on misrepresentations by Valve, entered into a new software publishing agreement (SPA) with Valve in 2001.
Click to expand...
Translation:Basically, Valve realized it was royally screwed, and pulled every string to regain the copyright.
"Among other concessions, Sierra agreed to relinquish intellectual property rights and to allow Valve certain rights to the online distribution of games. Valve did not disclose during the negotiations over the 2001 SPA that it was in the process of developing a new technology called Steam that would allow consumers who would normally purchase games from Sierra/VUG at retail to purchase those products online directly from Valve.

"It was not until March 2002, nearly a year after the 2001 SPA was signed, that Valve announced the new Steam technology in a Game Developers' Conference in San Jose. Production of the source code in native, electronic, compliable format will allow Sierra/VUG to analyze the timing of Valve's development of Steam and the relevant Valve games.
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Translation:The failure of mentioning steam really doesn’t matter at all, steam is just the name of the online distribution platform. Vivendi clearly agreed that Valve could retain rights to online distribution. Vivendi knew exactly what it signed, but now that Half Life 2 is going to be huge, and so is team, Vivendi sees a large piece of the pie that is worth trying to get, even if your case probably won’t make it.

Countless writers have sued (and won) cases where a newspaper that was lisenced to print an article also posted that article online. Vivendi will most certainly loose this case.

"The timing of Valve's development of the source code for Valve games, the Valve source engine and Steam are critical to the development of several of Sierra/VUG's counterclaims, including: Sierra/VUG's promissory fraud claim based on Valve's false promises that it would continuously develop games to completion; Sierra/VUG's fraud claim and claim for breach of the covenant of good faith and fair dealing based on Valve's concealment of Steam and its strategically delayed development of the Valve games to coincide with the commercial release of Steam; Sierra/VUG's unilateral mistake claim based on its mistaken belief regarding the status of development of the Valve games upon signing the 2001 SPA; Sierra/VUG's breach of contract claim based on Valve's failure to use diligent efforts to continuously develop the Valve games to completion; and Sierra/VUG's claim for declaratory relief regarding its right to reversion of the Half-Life intellectual property based on Valve's failure to continuously develop the Valve games."
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This basically states “Valve purposely delayed Half Life 2 for an entire year just so they could distribute it over steam.” Even if it was true, it is a weak case.
 
i though vivindi financed hl2 to a large degree, and with the game already being a year late, its costing alot more. from their point of view, they see anyone who buys hl2 over steam, and not from a retailer, as stepping on their business, plus the business of the retailer.
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This may happen in a Pixar / Disney case, but even when you look there you see the publisher royally screwed the developer. According to NUMEROUS valve statements and interviews, Half Life 2 was completely financed by the profits of Half Life 1.

As far as Valve distributing over steam, all of that depends on their contract with Vivendi, and the contract clearly allowed Valve to distribute the game online according to a Vivendi press release. Vivendi sees millions of dollars that Valve will be getting that could have been their under a different contract, and is trying to rewrite the contract through the courts.

For example, I’m an independent design consultant, and chances are I would only see around 15% of the sale price on any project “published” by a distributor versus receiving closer to 85% of the sale price when I distribute the product myself. You’ve got to consider that Valve has invested some 40 or 50 million of their own pocket change and 6 years of hard work into the game. Vivendi will simply throw it in a box and distribute it and receive a significantly larger portion of the profits (distribution costs, marketing costs, and production costs completely covered).

As any intelligent and informed artist knows, you don’t give exclusive license to all areas of reproduction. That limits your ability with future product distribution and limits your ability as far as licensing for other products, such as movies or toys. Valve and Vivendi knew exactly what they agreed to, except Vivendi is now getting greedy.
 
Phantomdesign I will now be linking to your two posts during the next argument that comes up on this topic. :D
 
You seem to have over-looked some important details...

phantomdesign said:
The failure of mentioning steam really doesn’t matter at all, steam is just the name of the online distribution platform. Vivendi clearly agreed that Valve could retain rights to online distribution. Vivendi knew exactly what it signed, but now that Half Life 2 is going to be huge, and so is team, Vivendi sees a large piece of the pie that is worth trying to get, even if your case probably won’t make it.

Countless writers have sued (and won) cases where a newspaper that was lisenced to print an article also posted that article online. Vivendi will most certainly loose this case.
Click to expand...


You over-looked the most critical legal arguments:


1) Valve retained the right to SOME online disribution.


If Valve and Vivendi (ne Sierra) entered into an agreement where Valve suggested it wanted to sell the game online, without mentioning the Steam platform which was under planning/development, and Vivendi agreed without knowing about Steam, then in almost all legal contracts that's breach of contract for dealing in bad faith.


From the Vivendi quote, it sounds like Valve told Vivendi about Steam, but undersold its capabilities, making it out to be some kind of content distribution system, but not a direct marketing tool. In fact, if Valve DID have Steam in the works, planned as a direct marketing tooo, when they entered into the agreement, that's on the ragged edge of fraud.


If you own a car, and you know the car needs $5,000 in work, then you sell the car to another party after mentioning the car needs "some" work (pretending you don't know how much work is needed), then the other party can back out of the contract, citing bad faith. You knew the car was a lemon, you sold it anyway. You cannot withold critical information.


Same deal here. The particulars will be whether Valve insinuated physical media would be involved in the online sales or not (Valve suggested this would be like an on-line store selling copies) or if Valve spun the agreement in such a way that favored Steam.



2) The second bit you quoted, the part about writers, has absolutely nothing to do with the Vv.V case at all: apples and oranges.


Writers cede First North American Serial Rights upon purchase for publication, which gives to holder the right to publish on paper (when a magazine "buys" an article, they're actually buying the FNASR). FNASR is different from First Electronic Rights or First World Electronic Rights, which grants electronic publishing rights. They're two seperate and non-inclusive series of transferable rights, so therefor the sale of FNASR does not cede FER/FWER.


Vv.V has nothing to do with this, nor is it even close. Valve and Vivendi entered into a contract by which Valve was granted certain limited distribution rights based on a mutual understanding of the issues between the two parties. There's no second established distribtion rights in this case. The question is not "Did Valve try to gain a second set of rights with the agreement to the first?" but "Did Valve gain advantage in a contractual advantage by decit?"


Two totally different issues.


As someone else pointed out, we don't know what Valve is claiming, and I'm not paying to pull up the briefs electronically, but it's going to be interesting to see what Valve actually told Vivendi about Steam and how the judge interprets Valve's motives, but from what was on the Gamespot article, it looks like some damn dodgy dealing by Valve.
 
I doubt that this will delay the release of the game either via retail or steam. VU are pushing for a % slice of the steam sales is what it boils down to, and stuff like that can be determined post release. Right now the hype for HL² is good, 6+ months down the road things might not be so rosy :dozey:
 
Nah, I think VALVe is way too pissed. I can see the game coming out on Oct 6th as lombardi said. On Steam that is.
 
Vivendi did not finance HL2. Valve use the profits from HL1 to develop Source and HL2.
 
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