Silicon Knights V. Epic Games
In 2007, Silicon Knights sued Epic Games for failure to "provide a working game engine", causing the Ontario based game developer to "experience considerable losses." Silicon Knights' suit alleged that Epic was "sabotaging" Unreal Engine 3 licensees. Epic's licensing document stated that a working version of the engine would be available within six months of the Xbox 360 developer kits being released. Silicon Knights claimed that Epic not only missed this deadline, but that when a working version of the engine was eventually released, the documentation was insufficient. They also claimed Epic had withheld vital improvements to the game engine, claiming they were "game specific", while also using licensing fees to fund development of their own titles rather than the engine itself.
On August 9, 2007, Epic Games counter-sued Silicon Knights, claiming that they were using its engine without paying royalties. On May 30, 2012 Epic Games defeated Silicon Knights' lawsuit, and won its counter-suit for $4.45 Million USD on grounds of copyright infringement, misappropriation of trade secrets, and breach of contract.
Consistent with Epic's counterclaims, the presiding judge stated that Silicon Knights had "deliberately and repeatedly copied thousands of lines of Epic Games’ copyrighted code, and then attempted to conceal its wrongdoing by removing Epic Games’ copyright notices and by disguising Epic Games’ copyrighted code as Silicon Knights’ own". As a result, on November 7, 2012, Silicon Knights was directed by the court to destroy all game code derived from Unreal Engine 3, all information from licensee-restricted areas of Epic's Unreal Engine documentation website, and to permit Epic Games access to the company's servers and other devices to ensure these items have been removed. In addition, they were instructed to recall and destroy all retail copies of games built with Unreal Engine 3 code, including Too Human, X-Men Destiny, The Sandman, The Box/Ritualyst, and Siren in the Maelstrom.
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