Silicon Knights to Sue Epic – Where’s Lionel Hutz When You Need Him?

Silicon Knights, creator of the up-and-coming Too Human filed a lawsuit today against Epic Games (Gears of War) for allegedly selling sub-par licenses of the Unreal Engine 3 to developers.

Denis Dyack, founder of Silicon Knights, stated “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.” Silicon Knights wants Epic Games to relinquish all profits from Gears of War sales as compensation for damages to the Too Human development.

Too Human was originally in development for the Playstation, and has been delayed through the heyday of the PS2, and the launch of the PS3, before finally being slated for the Xbox 360. Silicon Knights claims that these delays were caused by Epic’s distribution and coding of UE3. During E3 2006, Too Human was initially brushed aside because of their use of the UE3 for it’s graphic’s engine. Dyack claims Silicon Knights “has lost revenue as a result of the considerable delay in developing its video game for the Xbox 360 because Unreal Engine 3 did not work as Epic represented it would and, moreover, Epic has been unable or unwilling to fix it.” The lawsuit also states that Epic Games used a more posh version of the engine for their title, Gears of War, keeping secret the functionality of the engine while garnering all of the positive press.

Denis Dyack is angry to be sure, but keep checking back as more information on this lawsuit develops, and Dyack keeps running his mouth before the actual court date. His lawyer needs to put the hush hush on him. It is interesting to note though that in the Unreal Engine 3 terms and conditions, it states that the “engine will not build itself,” as with all other licensed graphic engines. Could this lawsuit be the main reason for Silicon Knights delaying Too Human again? Sounds like it.

Full Press Release after the Jump

SILICON KNIGHTS SUES EPIC OVER UNSATISFACTORY PERFORMANCE OF UNREAL ENGINE 3

ST. CATHARINES, ONTARIO, CANADA, July 19th, 2007 – Video game developer Silicon Knights, Inc. has filed suit against Epic Games, Inc. for breach of contract, fraud, and several other tort claims in federal court in Greenville, North Carolina. In the lawsuit, Silicon Knights alleges that it 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.

As Denis Dyack, President and Founder of Silicon Knights, explained, “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. 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.”

The lawsuit further alleges that Epic in fact never intended to deliver Unreal Engine 3 as a fully functional game engine as promised. Instead, Epic collected licensing fees from Silicon Knights and others in order to fund the development of its own video game, Gears of War. “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. 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,” said Mr. Dyack.

Based on Epic’s website and press releases, it appears that Epic has sold licenses to Unreal Engine 3 to over 150 video game developers and publishers.