Crytek Vs Star Citizen Lawsuit – Settlement Talks

Welcome to some more Star Citizen, with updates on the Crytek v CI/Star Citizen lawsuit and settlement talks. And a quick summary of the case up until now.

I’ll prefix this with I am not a lawyer or legal professional and the summary and opinions here are my own and from what I understand of the case:

I have also covered the various stages of the case in greater detail.

CI and Crytek have been engaged in a legal battle since December 2017.

With Crytek alleging that CI broke various contractual arrangements CI were originally using the CryEngine to develop Star Citizen and Squadron 42 and since had changed to Lumberyard, Crytek say they were not allowed to change engine from CryEngine, the license was also only for 1 game and not 2. There were also other allegations CI sharing CryEngine code to 3rd parties it should not of, CI were supposed to provide bug fixes and updates to the CryEngine.

Crytek were pushing for an unrealistic amount of discovery (information about all the company’s financials, all dealings with customers, emails, a huge amount) for this which CI were disputing.

Some of the larger items from the case have since been dismissed by the court leaving Crytek’s remaining case much weaker. The court did not agree with Crytek’s creative use of language on the term “exclusively” when referring to who the contract was licensed for, Crytek said it restricted their use of engines. Even the “Bug Fixes” have been reportedly delivered now by CI.

CI had since requested that Crytek put up a bond for around $2.2 Million, if they lost the lawsuit, as evidence they could pay CIs legal fees and expenses. The date for Crytek to respond to the bond motion was rapidly approaching for May 28th.

There have been some updates to the Crytek v CIG case. Crytek has put in an APPLICATION FOR EXTENSION OF TIME:

“Crytek” hereby submits this ex parte application for an order extending the time to respond to Defendants’ Motion For A Bond (An ex parte decision is one decided by the judge without requiring all of the parties to the dispute to be present). Crytek requests that the Court grant an additional two-and-a-half week extension for Crytek to respond to that Bond Motion. The new proposed deadline to respond would be June 14, 2019; the new deadline for Defendants’ reply would be June 21, 2019; and, the new proposed hearing date would be July 12, 2019.

So why would Crytek want additional time to respond. According to the request:

Crytek had understood, based on the parties’ ongoing discussions, that Defendants would agree to an extension to facilitate settlement talks. On May 23, 2019, counsel for Defendants indicated that they would not so stipulate, which counsel for Defendants confirmed during a teleconference on the afternoon of May 24, 2019. Crytek filed this application promptly thereafter.

So it appears that Crytek and CI have been in settlement talks for a little while now.

It was assumed that the bond that CI have requested and the mass amount of discovery requested by Crytek were leveraging tactics for settlement.

The Application goes onto to say:

Since that time, the parties have been further engaged in efforts to resolve this matter through settlement. So that the parties may complete those discussions and determine whether this matter can be resolved without further litigation, Crytek seeks an additional extension to respond to the Bond Motion.

Defendants have indicated that they are unwilling to stipulate to such an extension. However, Crytek submits that the time and expense required to respond to the Bond Motion under the current deadline may derail any settlement discussions at this juncture. Therefore, a short further extension is respectfully requested.

The parties are engaged in ongoing efforts to resolve this matter through settlement. If a settlement is ultimately reached in the coming days by the parties, then an extension of time to respond to the Bond Motion will allow the parties to avoid the incurrence of additional time and expense associated with that motion.

What Does this Mean?

So it appears that CI have not really wanted an extension to this as they probably want to leverage a ticking clock in making a settlement. The irony here is that Crytek were really trying to push proceedings further and the discovery phase through as quickly as possible earlier in the case.

A settlement looks like it is the most likely outcome to this now, Crytek don’t want to lose in court a be burdened with paying CI’s legal fees OR even putting up the money for a bond, that would be held until the case was resolved. CI don’t want to have more legal fees or risk one of Crytek’s allegations getting through. I expect any settlement will be more of a token at this stage maybe not even covering the other sides legal fees.

We might not ever no the outcome publically of any settlements, some people have suggested at this stage Crytek might end up pay CI with a settlement, though I think that unlikely it’s not out of the realms of possibility. Star Citizen & Squadron 42 having switched engines now for some time and Crytek have been paid for the original license to the game engine that is no longer required.

Contracts like this are not moral obligations, they are more statements of if you break this, you could owe us this in damages. Tools for companies to be able to seek appropriate remedies. It’s certainly not any employees at Crytek’s fault that this has happened, in fact Crytek had (as I understand it) a reputation of not paying it’s employees for long periods when the company had financial troubles previously. It is quite possible that Crytek felt wronged and entitled to remedies BUT this look less likely by the day.

I will continue to cover this if we get any new information.