Subpoenas Served to Multiple Unreal Engine 3 Licensees Over Contracts; Epic Responds

Shacknews has learned that multiple Unreal Engine 3 licensees have been served with subpoenas in an effort to obtain their confidential engine contracts for use as evidence in Silicon Knights' coming court battle with Epic Games.

The two companies became embroiled in a legal feud after Silicon Knights filed suit against Epic last July. As part of its lawsuit--the allegations of which include Fraud, Negligent Misrepresentation, and Breach of Contract--Silicon Knights demanded all profits from the Epic-developed blockbuster shooter Gears of War in the form of awarded damages.

The subpoenas mark the first time that developers other than Epic have been entangled in the dispute. Companies that have licensed Epic's Unreal Engine 3, and are potentially now involved in the suit, include Electronic Arts, 2K Games, Ubisoft, and the United States Army, among many others.

"I'm leaving the litigation to the lawyers but, if this is the case, I'd like to apologize to any of our licensees who Silicon Knights have inconvenienced," remarked Epic VP Rein when contacted today by Shacknews. "We know that, like us, they just want to make great games."

If the license contracts are submitted as unsealed court evidence, they could potentially become a matter of public record. Given that the documents contain confidential terms, including negotiated licensing fees and other trade secrets, both Epic and its licensees would be at a substantial disadvantage if such information were made available to competitors.

The long-running battle stems from Silicon Knights' troubles in developing Too Human (X360). The company claims Epic held off on delivering promised Unreal Engine 3 features in order to focus on its own internally-developed, UE3-powered blockbuster Gears of War (PC, X360).

Epic fervently denied the allegations, and soon filed to dismiss the suit, refuting each of Silicon Knights' claims and countering that the developer agreed to the idea that the Unreal Engine 3 was a work-in-progress. The motion to dismiss was denied last November, and the case will now proceed to trial.

The suit has seen some developers taking sides over the issue. In talking with Shacknews last year, many industry veterans who worked with the Unreal Engine 3 came out in support of Epic, while others decried the late delivery of key engine features.

"It is true that Epic was very late in delivering key features to UE3 during the development of Gears of War," said a programmer working for a major developer.

Though some were critical, none of the grievances were as severe as Silicon Knights suggested.

"UE3 isn't perfect by any means, but I don't feel Epic misrepresented it in any way when we licensed it," added Josh Jeffcoat, former Gearbox level designer.