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December 5th Bethesda v. Interplay Court Hearing
December 5th Bethesda v. Interplay Court Hearing [ Company -> Update ]
Posted by King of Creation Thu 08 Dec 2011, 9:51 AM
News related to Top Story: Bethesda v. Interplay Motions Results | More info on Company: Bethesda v. Interplay | More info on Game: Fallout: Online

UPDATE: Thurs, 08 DEC 09:40 GMT: Here are the results!:

There is a lot referenced in the court transcripts from the Motions in Limine, so if you don't yet know what they were about, please click the links at the bottom of this bottom of this post to familiarize yourself with them.

The court hearing was a mixed bag for both Interplay and Bethesda. Neither company was a clear winner or loser, as both had things approved and denied.

Here is the main decision (ignore the numbers..they are line numbers from the transcript):

1 THE COURT: Okay. All right. With regard to
2 Bethesda's Softworks' motion. The first request is that
3 I hold Interplay Entertainment to have the burden of
4 proof on three separate or three potentially separate
5 issues. One, that Interplay has a trademark and
6 copyright license; that Interplay commenced full scale
7 development by April 4, 20-- I just said seven, but it
8 could have been nine. And second -- and third, that
9 Interplay had secured financing also by April of 2009.
10 The parties, I think, seem to agree that the party
11 asserting a license wants the party owning copyright and
12 the trademark rights to have shown ownership and copying
13 that the party asserting license has the burden of
14 proving the license. The parties agree there is a
15 document called Trademark License Agreement which at
16 least initially both sides asserted valid and
17 appropriately enforced. The question arises as to what
18 -- how to approach the problem as of April 4th 2009.
19 My conclusion is that the license was granted for
20 an initial period of two years. And while Bethesda is
21 calling this a "condition precedent" using contract
22 terms, I think more appropriately it is a condition to
23 the continued existence of the grant of the license.
24 This is a condition that automatically reverted the right
25 to Bethesda unless the condition was satisfied.
1 And, thus, I think it does come down to
2 Interplay's burden, at least of production, with regard
3 to the satisfaction of the condition in the grant. That
4 is, that it will be the burden on Interplay Entertainment
5 to come forward with evidence that it satisfied the
6 conditions in the TLA for a license as of April 4th 2009.
7 This is an express condition in the documents. It is one
8 the treatise writers, at least, talk about as one that is
9 -- results in an automatic rescission or reclamation of
10 rights if a grantee fails to perform the conditions and,
11 thus, it would, if they can't prove to the satisfaction
12 -- produce evidence of the satisfaction of the condition,
13 meaning they have not satisfied their burden of
14 production with regard to having a license.
15 I say "burden of production" because there is at
16 least one commentator that talks about separating out
17 perhaps a burden of persuasion from a burden of
18 production. It's "Patree" or "Patri" on Copyright. And
19 I'm not foreclosing the possibility, assuming that
20 evidence is in equipoise, which it rarely is, of deciding
21 that while Interplay has the burden of production on the
22 issue of compliance with the condition, that it may
23 ultimately remain Bethesda Softworks's burden of
24 persuasion.
25 I'm not -- the parties haven't -- you talked in a
1 uniform way about burden of proof, which is perhaps a
2 combination of both a burden of production and a burden
3 of persuasion. And so I think it only necessary at this
4 point to let you know that the burden of production of
5 evidence on all of these issues will apply to Interplay
6 Entertainment. The reason I asked you the question at
7 the beginning about whether there were any trademark or
8 copyright claims being asserted by Bethesda Softworks
9 before April of 2009 was that at -- if there were, that
10 potentially was raising a scope issue as opposed to the
11 existence issue about the license.
12 And so let me be clear that when we're talking
13 about whether there was a trademark and/or copyright
14 license post-April 2009, the burden of production is on
15 Interplay Entertainment. If we are litigating any
16 question as to the scope of any license pre-April 2009,
17 then it's likely a scope issue but only because the
18 parties, at least initially, agree that there is a TLA
19 in place. So, that's my ruling with regard to the first
20 issue.
21 The second issue is articulated as precluding
22 Interplay from offering parol evidence to support its
23 defense that the TLA granted a copyright license. This
24 would only come into play if in fact there was a TLA of
25 some sort that continued in existence if we're dealing
1 with the post-April 2009 time frame, if you're
2 understanding how I'm proceeding here.
3 So, if there is no license at all then, of course,
4 there is no looking at an April 11 date. At this stage
5 I'm really not prepared to rule in an almost summary
6 judgment-type scenario where I will come out. So I am
7 not going to preclude Interplay from putting on what is
8 being characterized as parol evidence in hard and fast
9 terms. That does not mean that I have decided that it is
10 relevant to any contractual interpretation issue that I
11 need to resolve. It's simply that in a bench trial I am
12 electing to defer any ultimate decisions about that legal
13 question. If this were a jury trial, I might have to
14 take a different approach.
15 The third issue is whether Interplay should be
16 precluded from arguing that it had satisfied full scale
17 development and minimum financing. Again, I'm not, at
18 this juncture, going to grant any summary judgment in the 19 guise of a motion in limine though. Depending on whether
20 they come forward with some evidence or not, they can
21 argue that it does or that I should find that it does
22 satisfy those conditions. But the burden is on Interplay
23 to come forward with some evidence.
24 Now, if there were rulings made during discovery
25 that preclude going beyond what was produced at
1 discovery. That's a different matter, and it's not my
2 understanding that's really at issue. But, rather, what
3 Bethesda Softworks was seeking here was almost a partial
4 summary judgment, and that I'm not going to enter at this
5 point.
6 Finally, though, Interplay is seeking only in
7 their pre-trial order to amend the pleadings to assert an
8 affirmative defense of mistake. Here, what I heard from
9 Mr. Gersh today differs from what was in his response to
10 this issue in the papers. Here you're saying it's
11 nothing new in terms of what the meaning might be of full
12 scale development and secured financing. In the response
13 to this motion, you point to language in the first
14 amendment answer and counter-claim dealing with, in
15 essence, additional trademarks and copyrights in terms of
16 what you were permitted to do. Because, at the time, I
17 thought this was stemming from the dispute as to whether
18 assuming there was a license to use the Fallout
19 trademark, what that meant. Did this have to be an MMOG
20 with the name "Fallout" but look like, whatever, Mickey
21 Mouse or some other character. And today I'm hearing a
22 different perspective all together.
23 In any event, "mistake" is an affirmative defense.
24 It must be pled with particularity; it has not been. It
25 isn't even proposed to be in the response to the motion
1 in limine, and I'm not going to entertain any amendment
2 to the defenses by way of a mistake. What I thought I
3 heard Mr. Gersh talking about today is that the true
4 battleground is whether there is evidence of full scale
5 development or the proper financing, but it's far too
6 late for Interplay to be contending that the TLA itself
7 should be rescinded, in essence, because of a mutual
8 mistake way back in 2007.
9 They have failed to articulate in any sufficient
10 manner what that might have been, and it's far too late
11 to infuse into this case a totally different issue. So,
12 we won't be amending the answer with the affirmative
13 defense of "mistake." Okay.

As for Interplay's Motion to have Thomas Bidaux barred from testifying:

25 THE COURT: Okay. Then, first of all, with regard
1 to the absence of a deposition, I am finding that
2 Interplay had an opportunity to take this deposition if
3 it wished, and I am not going to preclude Bethesda from
4 calling the witness on that basis. I find that I can't
5 rule, based on the current record at least, that
6 Mr. Bidaux will not have information that will be of
7 assistance to the trier of fact, and I'm not going to
8 preclude his testimony on that ground.
9 On the other hand, in reading the report, he
10 doesn't mention that he's seen material concerning what
11 Interplay had done. Instead, his report is based
12 entirely on his own experience, and he will not be
13 permitted to opine at all on whether Interplay had or had
14 not reached the -- satisfied the conditions in the TLA.
15 Rather, he is going to be permitted to testify as
16 proposed in his report as to what an MMOG is and entails
17 and nothing specific to this case, other than that
18 background education for the trier of fact which is going
19 to be me.

To summarize the above and other little bits from the hearing:

1. The burden of proof is on Interplay to prove 3 things.
A. it has a trademark and copyright license
B. it was in full scale development
C. It had secured funding of 30 million.
2. Interplay is not precluded from presenting parole evidence.
3. Interplay is not precluded from presenting evidence showing minimum financing and full scale production.
4. Affirmative defense of mistake will not work for Interplay.
5. Bethesdas witness can be at the trial, but can only testify as to what an mmo is and what it entails...he cannot comment on what Interplay has done.
6. Trial will be at 9:30 A.M. on Dec 12
7. Interplay thinks it will take 2 to 2 1/2 days for the entire trial.

So stay tuned to Duck and Cover for the latest!

UPDATE: Thurs, 08 DEC 03:45 GMT: I have the results of the assorted pre-trial motions in limine! It's a mix of wins and losses for both Interplay and Bethesda. I will be posting my writeup on them later today.

The big Bethesda v. Interplay court hearing that we've been reporting about took place today. It was, unexpectedly, a telephonic hearing rather than a standard in-court situation. Today's hearing was mainly about Interplay and Bethesda's separate Motions in Limine. We should find out soon what issues will be allowed and denied when the main trial takes place. I'm putting this post at the top and will keep updating it as more info becomes available. Right now, all we have is the following:

Telephonic Motions Hearing held on 12/5/2011 re [150] MOTION in Limine filed by Bethesda Softworks LLC and [151] MOTION in Limine No. 1 filed by Interplay Entertainment Corporation - Argued - "GRANTED" in part and "DENIED" in part for reasons stated on the record by Chief Judge Deborah K. Chasanow. (Court Reporter: Tracy Dunlap) (td, Deputy Clerk)

Granted in part and denied in part? But what parts? For reference, here is a list of recent relevant posts, with the earliest first:

Bethesda files Motion in Limine

Interplay fires back

Interplay goes for jugular, no more jury trial

Interplay tears into Bethesda's legal argument

Bethesda launches a volley

Interplay fits in a final argument before Dec. 5 hearing

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