Silicon Knights Suing Epic Games

July 19, 2007 | By: James Brightman

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Details are somewhat scarce at the moment, but GameDaily BIZ has learned that Too Human developer Silicon Knights is suing Epic Games, creators of the blockbuster Gears of War and licensors of Unreal Engine. Epic's Mark Rein is not pleased... [Update: Denis Dyack says Unreal Engine "inadequate" and causing "serious damage" to industry]

The gears of war are turning indeed. GameDaily BIZ has just been notified by Epic Games' Vice President Mark Rein, that independent developer Silicon Knights is suing the company over unspecified allegations.

"This morning we were served with a lawsuit by Silicon Knights. We believe the claims against us are unfounded and without merit and we intend to fully defend against them," said Rein.

He continued, "We'd love to tell you more about it but unfortunately our lawyers want us to save our comments for the courthouse so we're going to do our best to comply with their wishes. In that vein we'd appreciate if our friends in the industry and media would refrain from asking us about the suit because we're only going to say 'no comment.' We just wanted to share the news directly before the rumor mill starts churning."

So with that in mind, we've refrained, but we did put in an inquiry with Silicon Knights to see what this is all about. Silicon Knights has licensed Unreal Engine for its upcoming Xbox 360 exclusive Too Human.

We'll bring you more information when it becomes available.

[UPDATE] GameDaily BIZ has now heard from Silicon Knights president Denis Dyack.

"We stand behind everything in our complaint and believe it is highly unfortunate that Epic forced us into this situation. We would rather spend our time focusing on making great games, but as stated in our complaint, Epic simply refuses to acknowledge the inadequacies of the Unreal Engine 3 code it provides to its licensees," he said, "and refuses to accept the fact that its code has caused serious damage not only to Silicon Knights, but a number of other developers in the industry. We look forward to successful resolution of our claims in this court proceeding."

[UPDATE 2] Gamasutra has managed to obtain the full 52-page lawsuit filed by Silicon Knights, which demands a jury trial for alleged breach of contract regarding Unreal Engine 3 licensing.

The gist of the suit is that Silicon Knights (SK) was provided with the Unreal Engine far too late. Epic's licensing document apparently stated that a functional version of the engine would be available within 6 months of 360 development kits being available. Ultimately, however, the company got the engine in November 2006, "far too late for time and cost-sensitive projects like SK's videogames." It's the late delivery of the engine that SK blames for the horrible state of the game at E3 2006, a showing that did damage to their reputation.

"Epic apparently was able to achieve a very useable version of the Engine for the Xbox 360 � the version that it kept to itself, for use only on its Gears of War game (as discussed below), to the detriment of Silicon Knights and Epic's other licensees... Epic's plan to avoid its obligations and hoard all of the necessary functionalities not only harmed Silicon Knights and all of Epic's other licensees in the industry, but also gave Epic a clearly unfair advantage in the industry," the lawsuit said.

"That advantage was nowhere more evident than at E3 2006, where Gears of War was awarded 'Best Game in Show' and garnered nothing but laudatory press. By contrast, Silicon Knights � one of the only other [Unreal Engine 3] developers to publicly display a playable demonstration of its game � saw Too Human roundly criticized in the videogame press for its technical problems and generally unpolished appearance. The damage to Silicon Knights caused by Epic's misconduct was manifest, because E3 attendees were able to compare Too Human with another game running ostensibly the same game engine, Gears of War, with vastly superior results."

Furthermore, according to a press release just sent to GameDaily BIZ, SK "has lost revenue as a result of the considerable delay in developing its video game for the Xbox 360, Too Human, because Unreal Engine 3, a game engine licensed from Epic, did not work as Epic represented it would and, moreover, Epic has been unable or unwilling to fix it."

"Our strong preference is to focus on making games, not be in court. Unfortunately though, as explained in our lawsuit, we have had extensive problems with the Unreal Engine 3 that Epic has been unwilling or unable to rectify," Dyack commented. "For more than a year, we have been trying to reach an agreement with Epic to resolve these issues without resorting to litigation, but were unable to come to reasonable terms with Epic. Regrettably, we are now forced to go to court in order to achieve satisfaction. We remain hopeful, however, that we can reach a reasonable business resolution with Epic at some point."

"No doubt Gears is a fun and phenomenally successful game, but as we alleged in our complaint against them, we strongly believe that from the perspective of someone waiting for a game engine that Epic promised it would deliver almost two years ago, it seems pretty clear that Gears was built on the backs of the Unreal Engine licensees," he added. "We certainly stand by our allegations in the lawsuit that instead of using our licensing fees to develop and support the Unreal Engine 3, Epic used that money to build Gears."

Now, in the meantime, it would seem that Silicon Knights is looking to remove elements of Unreal Engine from Too Human in favor of making its own engine or pursuing some alternative engine. It's undoubtedly a huge setback for the game, and it makes us seriously wonder when exactly the game will be able to ship.