Trouble in Paradise

[phantomdesign]

You over-looked the most critical legal arguments:


1) Valve retained the right to SOME online disribution.

Is “some” stated in the contract? I seriously doubt it. If you want to refer to some in a contract, “some” would allow valve to distribute as Half Life 2 as much as they please online.

Basically Valve retained numerous rights, including intellectual property rights (to the art, programming, source code, concept, etc), and certain distribution (example: online), repackaging (posters, toys, coffee mugs, t-shirts, bumperstickers), derivitave works (ex: half-life based movies, books, images), and more. When an experienced artist or programmer retains ANY right, they know precisely why they’re doing it, and so does any other party that signs the contract.

Example
Lets say you drew a picture, and everyone loves it. A newspaper contacts you and wants to print it in the newspaper. If you’re an experienced artist, you only license them the right to publish that image in a single newspaper volume (scope of distribution) and you promise (contract) to not publish it in other newspapers for 30 days (scope of exclusivness). You picture gets the whole town jumping, and a coffee mug maker contacts you asking to use it on his coffee mugs, and kinkos wants to sell posters of it to art museums, and two other newspapers and one magazine ask you to print the image.

What can you do? You can have your images on the mugs, posters, and magazine, but you have to wait 30 days before you can get them printed in the newspapers. If you’re smart, you use similar licensing agreements which allow third parties to continue to approach you and offer further financial opportunities. At the end of the 30 days, you’re free to do whatever the **** (I bleeped that) you want with your own **** image.
End of Example

So, you have to ask two questions. [1] What is the scope of the copyright usage licensed to Vivendi? [2] What was the scope of the exclusiveness to copyright usage licensed to Vivendi?

Now it is my evaluation that [1] the scope of copyright usage is “The Distribution of Half-Life 2 through retail boxed games” (ok, that’s not lawyer-speak, but it should be understandable). Basically, one way or another none of the agreements that are still active allow Vivendi to distribute it online (95% likely). Even if Vivendi did possess such a license (5% chance), it doesn’t mean Valve can’t do it, nor does it limit the scale of Valve’s distribution through other means.

That’s where exclusiveness comes into play. As far as I could read into the situation, no contract signed by valve that is still active gives Vivendi any all-medium exclusiveness (print, broadcast, online, boxed with CD, or any distribution medium preexisting or to be invented) or any sort of exclusiveness to online distribution.

One point on some Vivendi speculation… Vivendi speculates that they were mislead by valve on the reason for the delay, and proposes the real reason for the delay was steam, and therefore to undercut their profit. Two problems. [1] First, publishers are renown to find ways to undercut the artist/programmer/producer’s profits and get away with it in almost every case. The laws do not necessarily have any sort of protection against this sort of action. Regardless of misunderstandings between the parties, the only real standard is #1 the laws and #2 the contract. [2] Valve could easily argue that steam was part of the development of half life 2, and therefore a valid reason to delay.

Returning to the ‘problem 1’ in the previous paragraph, in cases such as this, the likelihood of actually being mislead or misinformed is practically zero. You don’t have fresh-out-of-law-school lawyers that know less about copyrights than I do handling contracts like this.

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.

Even if being ‘mislead’ is a valid argument, in all probability Valve did not know at the time how big steam would get. Remember that Valve was surprised after E3 2004 at the response they were getting? Opportunity knocks and they took it…legally.

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.[/qutoe]
Your cited documents are apples to oranges comparisons, but the standard I refer to is the actual US copyright documents which specifically protect computer programs and code in basically the same way writing and images are. There are even sections dedicated to computer programs; I know because I’ve personally read 70% of it quite carefully and at least partially reviewed the remainder. I’ve even researched case studies in a variety of forms (from images, to music, design, and computer programs).

What you cite is apples and oranges, but I’m referring to the laws that make up the very base of this issue.

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.

In all likelihood it doesn’t matter. I know how one sided these sorts of public releases are and how to see through them. Vivendi did some bad dealing through unlicensed distribution and additionally refused royalty payments, and for revenge it’s having it’s high-dollar lawyers scrape the bottom of the barrel to attack Valve.

If there really was a strong case of valve intentionally and directly misleading Vivendi in a malicious manner, you would have read a much different press release. Even if this was the case, this wouldn’t be enough to stop Valve from using steam, only enough to allow Vivendi to back out of (void) the contract (aka, not produce boxed version of HL2)

 

[Guus345]

thats stupid because after hearing what some fans have post its seems that they want the game badly and are thinking about buying it thru steam but also want the CE, and what about this surprise about the CE that just spring up, maybe this lawsuit is being over exaterated

 

[ThunderLips]

Gabe.

Set up a shelf company, perhaps off-shore, finish the game with that company (state that Valve was unable too) and is dissolved, game dissappears / reappears as whatever, distribute it thru Steam if you wish and VU has absolutely no case against you.

I'm no lawyer but my bo$$e$ do this on a monthly basis to avoid tax, paying employee benefits etc etc etc

 

[Jokkar1701]

So it is possible that VU hold the release of HL2 and released it after the trial the 21st march 2005 !!?????????????? Aaarrghhhhhhhhhhhhh

 

[Revisedsoul]

this could explain the delaying of tfc2

 

[slashandburn]

I hope this lawsuit doesn't stop half-life 2 from reaching the store shelves. And what about all of the hl2 voucher holders?

Quick Thought
I wonder if valve would agreed to not sell the game initially over steam for a period of time. To let vu get there initial purchases. I don't see a dad on christmass day buying half-life 2 for his son over steam. Steam doesn't even wrap properly. They have to come to some sort of understanding.

Valve :cheers: Vivendi
The valve **c**n* vu picture is great.

 

[el Chi]

Exactly what would the results be if Vivendi were to win the intellectual rights to the Half-Life series?
Would they be able to produce as many games as they wanted to bleed the cash-cow dry? Could they give the task of making a sequel to a different developer? Could they stop Valve from distributing via Steam?
I'm assuming it means they have power over the product (and its universe, etc. therein), even though Valve dreamt it up and fleshed it out.

 

[Dynasty]

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:

yeah but six months down the road, hl2 will already be the biggest selling game ever. america will release it first, and anyone with a brain cell in europe (highly unlikely), will be buying hl2 through steam. its kinda unfair that hl2 comes out in the US 2 or 3 days before europe gets it, because people in the US wouldve already finished it by then.

anyway, valve did make the right choice about steam. although...if hl2 is to be delayed because VU wont allow it due to their bloody legal problems with valve, will it be released on steam regardless???? just makes sense imo to do so. just get the bloody game out and then sort out your petty legal wars!!! dont get us involved valve!!!

 

[Sprafa]

Exactly what would the results be if Vivendi were to win the intellectual rights to the Half-Life series?
Would they be able to produce as many games as they wanted to bleed the cash-cow dry? Could they give the task of making a sequel to a different developer? Could they stop Valve from distributing via Steam?
I'm assuming it means they have power over the product (and its universe, etc. therein), even though Valve dreamt it up and fleshed it out.

Basically yes. Valve would have to ask Laidlaw to make a new story.

 

[el Chi]

But surely they'd have to ask Vivendi's permission to finish the series?
But then Vivendi could decide that, even though it was intended as a trilogy, there could be more adventures to be had so they'd like to make many, many more.

 

[Chode]

LOL! I knew this was coming.

 

[LAYP]

I am sorry, I posted my sig here. please delete this post.

 

[Andy]

So basically, after all Valve's hard work, VU think they can just go: "Yoink!", and HL2 intellectual property will belong to them?

How the hell could they get away with that?!

EDIT: and yes, if VU got hier grubby little hands on it, god help us all, they'd probably finish the third one, rename the series 4,5 and 6 and then go make the 3 prequels. Argh!

 

[Kadayi]

yeah but six months down the road, hl2 will already be the biggest selling game ever. america will release it first, and anyone with a brain cell in europe (highly unlikely), will be buying hl2 through steam. its kinda unfair that hl2 comes out in the US 2 or 3 days before europe gets it, because people in the US wouldve already finished it by then.

anyway, valve did make the right choice about steam. although...if hl2 is to be delayed because VU wont allow it due to their bloody legal problems with valve, will it be released on steam regardless???? just makes sense imo to do so. just get the bloody game out and then sort out your petty legal wars!!! dont get us involved valve!!!

Why quote my post when you don't even bother to read what I'm saying? The point of my post was that commercially delaying the game for another 6 months to sort out a legal wrangle isn't going to happen because not shipping a product when it is ready is far more damaging to sales than waiting for a legal decision as to who gets what from the expected profits. Money in the bank earning interest now is far better than 'potential' profits 6 months down the line any day of the week, especially when you have shareholders looking for good dividend returns, every quarter.

As for HL2 being shipped stateside earlier than the rest of the world, that isn't going to happen unless Vivendi are obscenely stupid. Activision made the mistake of staggering the release of Doom 3 after it had been hyped through the roof, and they lost several million in sales from angry and frustrated europeans downloading the pirated version.

The intellectual rights writ is a bit of stonewalling on Vivendi's part, they have to make an argument in order to press a case. Seriously it is just a squeeze to get Valve to cut them a profit share of the steam sales.

Personally I think that Valve must of had some notion of the potential of steam as a sales platform when they renegotiated with Vivendi, so I think Vivendi probably have a case. Will they win back the intellectual rights? Well aside from funding the original game to a degree they didn't contribute to the process, so it's highly unlikely that any level headed judge is going to hand over all Valves efforts to Vivendi on a plate. This is purely about money, Vivendi are looking to cover their losses from the steam sales.

I expect that Valve will be ordered to compensate Vivendi a % sum per steam unit sold during the initial sales period.

 

[Teta_Bonita]

Remember kids, what's the source of all of our problems (including Half-Life 2 being delayed)?

Buerocrats!

 

[Shuzer]

yeah but six months down the road, hl2 will already be the biggest selling game ever. america will release it first, and anyone with a brain cell in europe (highly unlikely), will be buying hl2 through steam. its kinda unfair that hl2 comes out in the US 2 or 3 days before europe gets it, because people in the US wouldve already finished it by then.

There is no way HL2 will be the best selling game ever. Myst holds that title, AFAIK. And there's no way it'll ever sell as many copies as it has.

 

[Kadayi]

There is no way HL2 will be the best selling game ever. Myst holds that title, AFAIK. And there's no way it'll ever sell as many copies as it has.

I thought 'The Sims' was the biggest selling computer game of all time? It shipped something like 20+ million copies of the original game, plus oodles of expansions on top. HL2 will sell well, but I doubt it will come close to reaching the sims Sales figures (as it isn't likely to pull in the female demographic that much).

:|

 

[polyguns]

Common, valve didn't know what a success steam would be? that has to be a joke. its the only way you can get patches, or even play any of their games nowadays, its the only legit way to get the cs source, and they already started with hl2 preload. i mean common guys, vu should get a cut, or, as I was under the assumption, when i use my voucher, I want my boxed version as well, which I expect to get 4-6 weeks after I send in my voucher.
I can understand buying over steam, and letting the people download the game for the same price as they pay in the store, but they should all be garunteed a boxed version shipped as well, that way vu gets their cut.
people act all scared of the big publisher getting all the money, but what do you get if this rend continues? games only being offered online, direct from the makers, with no box art, no store front displays, no "hey mom while your shopping im gonna go check out games" Stuff like this will undermine our whole commercial based economy.
Right now, profit is spread over several areas of the economy. producers(valve) publishers(vivindi) and retailers(any game distributor).
All of these areas provide jobs for people.
Steam cuts out(assuming the theory is right and valve keeps 100% of the money from hl2 purchased over steam) the other 2 branches that would normally make profitt. and every half life 2 fan with broadband can "preload" and get it the instant it comes out, rather then going to the store, and buying it, justifying the work of retailers and the publisher.
remember when you fanbois want to slam the publisher that with publishers and retail distributors of games, where would half life have gone?
so during this whole convo, one important element was left out, the retailers. Retailers have been promoting half life, and half life 2 for a long time, discussing it with their customers, pushing and advancing it. think how they must feel being left out of the loop on games via steam.

 

[The Mullinator]

Common, valve didn't know what a success steam would be? that has to be a joke. its the only way you can get patches, or even play any of their games nowadays, its the only legit way to get the cs source, and they already started with hl2 preload. i mean common guys, vu should get a cut, or, as I was under the assumption, when i use my voucher, I want my boxed version as well, which I expect to get 4-6 weeks after I send in my voucher.
I can understand buying over steam, and letting the people download the game for the same price as they pay in the store, but they should all be garunteed a boxed version shipped as well, that way vu gets their cut.
people act all scared of the big publisher getting all the money, but what do you get if this rend continues? games only being offered online, direct from the makers, with no box art, no store front displays, no "hey mom while your shopping im gonna go check out games" Stuff like this will undermine our whole commercial based economy.
Right now, profit is spread over several areas of the economy. producers(valve) publishers(vivindi) and retailers(any game distributor).
All of these areas provide jobs for people.
Steam cuts out(assuming the theory is right and valve keeps 100% of the money from hl2 purchased over steam) the other 2 branches that would normally make profitt. and every half life 2 fan with broadband can "preload" and get it the instant it comes out, rather then going to the store, and buying it, justifying the work of retailers and the publisher.
remember when you fanbois want to slam the publisher that with publishers and retail distributors of games, where would half life have gone?
so during this whole convo, one important element was left out, the retailers. Retailers have been promoting half life, and half life 2 for a long time, discussing it with their customers, pushing and advancing it. think how they must feel being left out of the loop on games via steam.

First of all Gabe said that he didn't think online distribution would work "today" back in September of 2000, considering today is not the year 2000 I have to say that Gabe didn't lie.

Second of all you have to understand that just because online distribution cuts out the retailers and publishers doesn't suddenly mean that we shouldn't use it. How do you think horse breeders and cart makers felt when the automobile was invented? Besides, Vivendi has pulled alot of crap in the past, ask Blizzard how they think of Vivendi why don't you.

 

[alltracdrmer]

honestly..

seems like everytime we get near a relese something happens. I happen to belive they are all cover ups, that the source code was never stolen. there is something bigger going on here than we can imagine. The truth is out there gentelmen.

on a side not dont mind my random jargon im a pretty weird guy

 

[Kadayi]

I happen to belive they are all cover ups, that the source code was never stolen.

LOL, tell that to the german hackers currently residing in some f*ck me hard in the A** state prison. :upstare:

 

[phantomdesign]

Why quote my post when you don't even bother to read what I'm saying? The point of my post was that commercially delaying the game for another 6 months to sort out a legal wrangle isn't going to happen because not shipping a product when it is ready is far more damaging to sales than waiting for a legal decision as to who gets what from the expected profits. Money in the bank earning interest now is far better than 'potential' profits 6 months down the line any day of the week, especially when you have shareholders looking for good dividend returns, every quarter.

As for HL2 being shipped stateside earlier than the rest of the world, that isn't going to happen unless Vivendi are obscenely stupid. Activision made the mistake of staggering the release of Doom 3 after it had been hyped through the roof, and they lost several million in sales from angry and frustrated europeans downloading the pirated version.

The intellectual rights writ is a bit of stonewalling on Vivendi's part, they have to make an argument in order to press a case. Seriously it is just a squeeze to get Valve to cut them a profit share of the steam sales.

Personally I think that Valve must of had some notion of the potential of steam as a sales platform when they renegotiated with Vivendi, so I think Vivendi probably have a case. Will they win back the intellectual rights? Well aside from funding the original game to a degree they didn't contribute to the process, so it's highly unlikely that any level headed judge is going to hand over all Valves efforts to Vivendi on a plate. This is purely about money, Vivendi are looking to cover their losses from the steam sales.

I expect that Valve will be ordered to compensate Vivendi a % sum per steam unit sold during the initial sales period.

Unlikely. It is generally preposterous to suggest that an developer (Artist, programmer, whatever) will owe the publisher royalties when the publisher has no hold on exclusiveness in the specific sector the developer decides to publish the game themselves.

Common, valve didn't know what a success steam would be? that has to be a joke.

If this sort of thing was common knowledge, why would a small developer (such as Valve) be the ones to come forth and make it a success? Steam was an idea worth trying, and as time went on it started to become increasingly popular. I was amongst those who heavily criticized the idea of downloading your copy of Half Life 2 and not having an in-the-hands box.


---


All Vivendi does is [1] market the game [2] produce the hard copy and [3] distribute the game. Now, when Half Life 2 was shown as E3, the response was incredible, much more than any television advertisement does to promote a game (which, by the way, the publisher would only pay for the air time while the developer makes the advertisement). So, when you take issue #1 in context, Vivendi's hopes for marketing the game half of what Valve has accomplished are approximately Zero. Moving on to #2 and #3, Steam is a viable platform to perform both of these functions.

Why is Vivendi pissed off? [1] Well, it started when Valve discovered some illegal redistribution of their hard work. No one likes getting caught. [2] Secondly, Valve is a HUGE money-maker and Half Life 2(which has the potential of many expansion packs of sorts) is MASSIVELY popular as a game and very capable from a technical standpoint. Valve has realized over time that they can move further and further towards not needing a publisher, and therefore receiving a much larger portion of the profits (I'm the same way, as soon as I can 'publish' my own projects, I will be doing precisely that). Vivendi is getting irritated because the potential profits from Valve are increasing while their hold on Valve is slipping. This means they're loosing out on potential profits.

If I was Valve, I would be counting the days until the contracts with Vivendi are over. I would impatiently be awaiting the day I could start a bidding war between the major publishers and reverse (if not more than reverse) the 1/3 developer 2/3 publisher profit split.

You've got to understand that up until this point, Half Life 2 is entirely Valve's investment in every way. Vivendi's only stake in this game is a slice of the pie and Vivendi is getting greedy. Vivendi is a service, like UPS or someone who mows your lawn. Vivendi just tries to maximize their capitalization of their 'monopoly' and takes advantage of those who are smaller than them.

 

[alltracdrmer]

LOL, tell that to the german hackers currently residing in some f*ck me hard in the A** state prison. :upstare:

Uhh germany dosent have states....

 

[poseyjmac]

and hackers don't go to the same prisons as hardened serial killers and the like, so they don't get pounded in the ass

 

[Alsi]

We DO have states - called "Bundesländer"

ooops offtopic

Well, did not read all the stuff. But I don't really care about some lawyers and companies making money. The game will be the same price 4 me whoever wins. :angel:

 

[Kadayi]

Unlikely. It is generally preposterous to suggest that an developer (Artist, programmer, whatever) will owe the publisher royalties when the publisher has no hold on exclusiveness in the specific sector the developer decides to publish the game themselves.

LOL, preposterous...hardly :dozey:

Vivendi can do what they like legally if they believe that an activity by someone they have a business agreement with will undermine their product sales regardless of whether it falls outside of their normal distribution methods. Whether you buy the box or your buy from steam, the product is still the same. Steam is shaping up and Vivendi are concerned that they might actually loose a fair amount of sales to it.

It's not about royalties, it's about loss of income.

 

[Kadayi]

and hackers don't go to the same prisons as hardened serial killers and the like, so they don't get pounded in the ass

Are you an ex-con hacker? Do you know hackers in prison? Do they have special hacker prisons?

 

[phantomdesign]

LOL, preposterous...hardly :dozey:

Vivendi can do what they like legally if they believe that an activity by someone they have a business agreement with will undermine their product sales regardless of whether it falls outside of their normal distribution methods. Whether you buy the box or your buy from steam, the product is still the same. Steam is shaping up and Vivendi are concerned that they might actually loose a fair amount of sales to it.

It's not about royalties, it's about loss of income.

I already adressed the legal issues regarding to distrbution of alternative mediums.

So, you have to ask two questions. [1] What is the scope of the copyright usage licensed to Vivendi? [2] What was the scope of the exclusiveness to copyright usage licensed to Vivendi?

Now it is my evaluation that [1] the scope of copyright usage is “The Distribution of Half-Life 2 through retail boxed games” (ok, that’s not lawyer-speak, but it should be understandable). Basically, one way or another none of the agreements that are still active allow Vivendi to distribute it online (95% likely). Even if Vivendi did possess such a license (5% chance), it doesn’t mean Valve can’t do it, nor does it limit the scale of Valve’s distribution through other means.

That’s where exclusiveness comes into play. As far as I could read into the situation, no contract signed by valve that is still active gives Vivendi any all-medium exclusiveness (print, broadcast, online, boxed with CD, or any distribution medium preexisting or to be invented) or any sort of exclusiveness to online distribution.

Are you talking about what you think it is supposed to be or do you actually have background knowledge in these issues? Copyright Laws cover issues of of ownership, mediums of distribution, exclusivness, and lisencing types. What you're talking about is always trumped by copyright laws.

Where are you getting a loss of income from? Where are they loosing income that is theirs to have? If the scope of exclusivness does not cover online distribution (which it clearly doesn't) then Vivendi hasn't lost any income.

Vivendi isn't a victim here, they're going to reap millions of dollars of Valve's hard work either way.

 

[phantomdesign]

Are you an ex-con hacker? Do you know hackers in prison? Do they have special hacker prisons?

They usually don'y send hackers to maximum security prisions.

 

[Kadayi]

Yadda Yadda Yadda

Your grip on core legal issues is as shaky as your ability to spell check your posts. The crux of the case isn’t about whether Valve may have breached the copyright conditions of their present contract with Vivendi. The case it is about whether Valve deliberately deceived Vivendi when it came to negotiating that very contract, regarding the full intent of the online sales/distribution element. It’s a classic chicken/egg situation. Did the agreement occur before steam was realised as an idea, or after? Because it is clear that Vivendi wouldn’t of agreed to Valves contract demands for online distribution rights if they were fully aware of the potential effectiveness of Steam.

Now if your still struggling with this fairly obvious argument, lets see if you can answer this conundrum: -.

If Vivendi didn’t believe that they had a viable case to pursue a legal action against Valve for deception, why would they attempt to do so? Companies don’t go to court out of principle :dozey:

 

[polyguns]

i was just saying, it sux for retailers and distributors. Vivindi is having their own problems caused by their own corruption, like that dude in france that got arrested. I don't think that valve is an innocent victim in this, if they want to distribute their own game then they should

 

[Ecthe|ioN]

I can't wait to see Vivendi getting pwned by Valve! Go for the balls Valve!! THE BALLS!!! I know Vivendi's balls are small but they are there somewhere!!