I’m saying they get authority through the court ruling.

PM sent

People here wonder what ARA has to gain from this, as they will probably not get any money from DP. So here is my take on this:

How I understand Dutch law, if they win the claim, they then might own all assets including the 40-ish finished machines, and are legally allowed to liquidate (sell) them, of course pending the license issue. We do not know the contents of the claims filed, but I would imagine they are trying to obtain those as well (it may very well be the most valuable asset DP is still holding on to).

As usual in cases like this people are choosing sides. I have chosen mine based on my business knowledge and human knowledge and fully respect people decide to chose the opposite. They have after all 8500 reasons to do so. Who am I to say I know it better ??

I just fail to see however where DP has proven lied to us (besides the PCB lie). They have given us a lot more info on the matter as ÄRA did. In fact ARA even fired their manager because of this. We can accuse DP of non-communication and sometimes living in a dreamworld with Bop 3.0 SLE but not of lies as far as I know.

Anyway, choose the side you wish. I do hope documents will be revealed during court trials for the whole world to see so we can objectively see who was really in the wrong. Should be not to difficult to compare pricing on a contract with an invoice after all. And if I am in the wrong so be it. Than my antennas for sensing trueth when I talk in length with people need to be adjusted in a big way

Really?

ARA is under no obligation to give any information to anyone but DP.

I would say ARA is sueing for breach of contract
DP failed to pay for games already supplied and failed to pay for games still at ARA

DP decided that due to ARA wanting more money per game they would go elsewhere and walk way from their agreement.

ARA stuck with parts to build 300 games and goods manufactured not paid for, ARA will win and DP will have to pay damages, at least all outstanding and all the inventory which they don't have the money, so DP will fold like Heighway with no assets.

This. DP are a bunch of delusional fools and should have taken the prior deal that ARA offered them. What a bunch of sleeze bags! If they cared about you buyers, they would have taken the deal and you all would have had your games by now! Instead, the company will go under and buyers will end up with nothing. Those games will be sold by ARA to the highest bidder to help pay money owed. DP didn’t care about anyone but themselves! As always in these cases, the lawyers win, everyone else loses! DP belongs in the same box as JPOP, Andrew and Kevin!

The only thing that makes sense to me (not a lawyer) about ARA's lawsuit against DP would be for prior work done and not paid for, not future work.

How DP thought they could just walk away and everyone would forget about it is crazy. What was going to happen to those games? Landfill?

Without dealing with the ARA problem, the inevitable happened, and here we are.

Maybe this was always going to be a lose-lose for DP, maybe ARA had them over a barrel from the beginning, and the terms and everything else were untenable. But in a sense that ship sailed the day DP signed with ARA, so it still comes back to them.

And someone in the US wires ARA 10K+ and shortly after gets no pinball. Now that person is out 20k and has to start a lawsuit from the US.

Even with a court ruling it would be problematic for ARA to sell those games due to the licensing agreement. Dutch Pinball owns that agreement and I highly doubt it would be transferable. Worth noting the license is likely expired or soon to be.
I'm not sure what ARA's end game is here but taking ownership of those machines will not come without consequences.

And still taking a "salary".

Now I'm curious, Kim. I always took for granted a licensing agreement allowed someone like DP to manufacture TBL for a specific time period. I've also heard an agreement may allow someone to manufacture X number of a particular game, no matter how long it takes. What I'm wondering is, does an agreement specify who has to sell the game? Doesn't seem like who sells it would matter.

Its an open question and I don't know how those contracts are structured. I'm sure there are variables that are negotiated from deal to deal. Heighway Pinball got the rights to Alien but no Sigourney Weaver in likeness or voice.

I'm just questioning the status of the license. Has it expired? Is it transferable? None of us know.

I'm not sure if I follow your comment but yes, it would matter. That's the purpose of buying/selling the license and abiding by its terms.

I just read a clause in the Universal license agreement, I had for parts, doubt it would change that much but Bankrupt or Liquidation the license is Cancelled. With Universal normally its a min upfront license fee to be paid , min guarantee and as these games were sold years ago they would still fall under the license. If the courts say ARA own them for unpaid debts they could be sold.

I think liquidating them would be like a private seller/second hand sale. The game is already licensed and can be resold by anyone. The point being it’s being resold... not marketed/distributed/etc.

The catch would be is if it’s considered ‘work in progress’ or incomplete by some terms in the contract (imagine if it never passed ‘final inspection’ or something) and there are terms that say such incomplete items can only be destroyed. In that case the items could be taken off the table and not up for liquidation.

So with the agreements you had, I'm fully aware they allowed you to manufacture certain products, but were you the one who had to sell said products?

Let's say you made 50 sets of IJ cabinet decals. Now let's say because you owed me money and rather than you writing me a check, you paid me by giving me the decals. Can I legally sell them?

As the license fees would have already been prepaid I could do what I liked. But I would need to declare the amount on the royalty report, Yes I was the license holder, but once I sold them anyone was able to resell them. If they had 300 games in the agreement and they wanted $100 a game royalty and they paid $30k up front, then they are fully licenced.

If the min guarantee was $10k then they would send in royalty reports each qtr as games sell, so only 100 might be licensed before expiry or termination of license.

They might have sold and paid license fees on all games sold to cointaker but not delivered, I am sure Universal will audit the license now, ps I would be surprised if Universal even know who ARA even are as they don't give a shit who the contract manufacturers are, they only care about making money on license they don't care if you make a product or not. However this preorder model is probably against license conditions

I find that interesting.

Thanks for insight on all of this.

Tricia is who I delt with and ray de la rosa, from memory the license are done through fireflybrandmanagement on behalf of Universal

You are talking of Universal license if it allows ÄRA to sell the built units or not but what about a software license .....

What is a TBL worth without the software to run it? And for sure the software is IP property of DP. This needs to be added to the universal license allows Ära to sell or not.

Don’t know laws there but I would assume they will lose any IP when they go bankrupt

I know I'm not a member please don't stab me. But wanted to give some input on licenses.

They're always X money down to get started. Then either a total set amount (say 100k) which you amortize across all units, or pay X amount per unit with a minimum unit expectation (basically enough to make it worth the studio's time). The cover versions of the songs would also cost about $10 per song/per game.

The thing that NEVER changes is the time limit. Usually 3 years max, and the timer (generally) starts when you sign, NOT when you start production.

Thus the license probably timed out. Also if DP didn't hit the minimum payment amount (by the end of the term) they could be on the hook for that as well. (and rumor is they WAY overpaid to begin with)

Which enforces my idea is that ÄRA is starting this to get DP bankrupt and buy the IP for little money from the trustee. Sue them and drag the court case till they are broke policy.

Yup, and this is why DP should have taken the 51/49 deal and I was furious when they didn’t. They said it was because “DP was THEIR dream”. This was proof of Jaap’s ego trumping sound business logic. At this point, they fucked up. There is no DP without games shipping to customers. Like it or not, they needed ARA more than ARA needed them. The only way to succeed on this project was to work with them....and if they wanted to be a pinball company without ARA, the best move would have been to wrap up TBL with them, leave, and start a new pin company with this experience under their belt.

They always put their unrealistic ego version of “the dream” ahead of their customers....and without customers, they have NO COMPANY & the dream dies. They boned themselves under the false pretense of doing what’s right.

That’s exactly what ARA is doing.

How else would they ever get paid? They are sitting on worthless inventory right now

This and/or ARA figures, well if they have the money to start over with another contract manufacturer, they have the money to pay off this debt. If not, well, to your point, they get the software for nothing since the software has no value to anyone other than ARA and can now sell the finished machines to pay off the debt.

What ip? Some board sets designed by Arja in the first place?

The license isn’t some fixed asset to auction off.

IP on the software developed by DP. TBL hardware is useless without the software ....

And the software has proven Useless in the hands of DP.

We can speculate all we want, but some of you refuse to accept that it all boils down to the payment terms that were agreed upon between DP and ARA.

I can't speak for ARA, Xytech, or pinball manufacturing in general, but in Chinese electronics manufacturing, a 30% deposit with 70% payment after QC inspection pass is a pretty common (and fair) agreement. Depending on the product and buyer, one could negotiate that deal calling for a lower deposit upfront or for the remaining payment to be paid only after the product has actually shipped. A lower risk term could be 20% deposit, 50% payment after production/QC inspection, and the remaining 30% after delivery to whatever designated countries. One last option that really favors the buyer would be agreeing to no initial deposit with 100% payment two months after shipment. It all boils down to the product itself, your ability to scale future business (product), your company's "track record," and the risk that CM is willing take on you. If you're a company like Apple or Samsung, you can pretty much dictate your own terms and make the CM your beeyatch (which they do). My point here is that no matter the terms, a standard CM agreement almost always requires payment at the tail-end of the process.

There are some nasty CMs who will see a "mark" walk into the door and intentionally not make them pay for program costs such as tooling and software dev (the latter is not applicable in DP's particular case). This gives the CM complete leverage when it comes time to manufacture. The CM can hike the price, not meet your deadlines/quantities, and screw you over on quality control. This is also how they snag ownership of your prototypes and tooling, which is completely legal.

ARA wouldn't stop production over payment unless it had DP by the balls. There weren't any major quality issues that we know of, so what else could possibly halt production & shipment of games besides a monetary dispute?

If I'm not mistaken, ARA still has the BoP25 prototype in their possession. Wasn't this being developed at ARA? If so, it may explain why they're holding the prototype hostage. It appears from afar that DP most likely built the TBL engineering samples on a "pay as you go" purchase order basis. DP claimed awhile back that ARA still has a lot of parts in the factory to build 300 TBLs (including the $100K DP spent on P3-ROCs), but they never disclosed whether they actually paid for all the other parts for those 300 games. Why would DP bounce on ARA if they paid for all the parts?
Clearly, there's outstanding payment(s) owed to ARA. Can you fault them? They have bills to pay too.

If DP had a leg to stand on, they would have disputed the $1K cost increase. DP claims that ARA also delayed start of production, but isn't that what a contract is for? If they were smart, they would have dictated and enforced production start/finish dates and accessed penalties had those targets not been met. The same applies to the final unit price. I would've told ARA to fock themselves and then immediately taken legal action against them. A decent attorney would've have advised them to do the same. If the contract was clean and sound, DP would have nothing to worry about. Instead, DP chose not to take action, which in my eyes, makes them suspect (guilty). They then ran off to a different supplier. Were they really that naive to believe that it wouldn't catch up to them?

Based on my experience, companies who prematurely bail on their CM are short on cash. I know of an audio company who did this last year. Passive speakers should have a shelf life of 5-10+ years. They obviously owed their CM a lot of money because they were forced to redesign and reintroduce their entire speaker assortment with a new CM only after 3 years of shelf life. Why? Because the original CM owned their tooling and/or design based on a JDM partnership. Again, this is one of the drawbacks of cost-savings in the early stages of development. It frees up some of your capital in the beginning stages, but that can come back to haunt you later on.

If DP agreed to cough up the extra $1K on the unit price, they should have put this revised agreement in writing to prevent this mess they created. There would have been no misunderstandings. If everything was kosher, DP would have paid up, production would have resumed, and those 40 units would have shipped in 2016. ARA rightfully wanted to get paid and DP didn't come through. Do you really believe ARA wants to get into the full-time pinball manufacturing business? Give me a break! I also do not believe ARA wants to bankrupt DP. There's no incentive for them to do so, unless it's a last resort to squeeze a dry turd. This is DP's first stab at pinball manufacturing, and unfortunately, they're learning valuable business lessons along the way (at our expense). They're a tiny roach to ARA in the grand scheme of things. As I posted/proved yesterday, you can successfully crowdfund millions of dollars in capital for a new innovative widget or product, but if you don't know what you're doing, you can deplete all that money in no time before you manufacture your first unit. Rookie mistakes hurt the CM just as much as they hurt you.

In summary, put yourself in the shoes of ARA as a business owner. It's like a pawn shop. If you don't come back to pay what they loaned or fronted you (+ interest) by a certain date, they rightfully keep your item. Based on what I've seen here, a few of you would be more than willing to put your business and livelihood on the line for DP. I wish these people would put down the Kool-Aid and start drinking water.

Maybe a few would be willing? JK

Even though people are still hopeful, and that's a good thing, the reality is the problems were always staring us right in the face with Jpop, Kulek, Heighway and DP and we chose to overlook every single warning sign, lie, and lack of communication.

When you want to believe something its easy to justify away all the apparent problems.

Just like Heighway, DP has been done for a long time, its just the final nail in the coffin hasn't been driven in yet. It's coming.

ARA has DP by their bowling balls. DP is out of money and ARA knows this. DP needs to get this to court-assigned mediation ASAP if they have any chance of survival. They tried unsuccessfully negotiating with ARA in the past, but now they have to face reality and deal with the outcome no matter what. Any "crumbs" DP has left as of today will be consumed in legal costs. Even if they finally come to an agreement with ARA, they will still need to pay ARA a significant chunk of change to proceed no matter the final unit cost. DP may possibly have the ability to pay for those 40 units in ARA's warehouse, but I don't see how they can fund the rest of production without whoring themselves out to ARA or some foolish "hero" investor.

Either way, they also have to contend with their legal obligations to Universal, preorder customers, and any other participants/vendors/suppliers who were involved in this fiasco. I'd like to believe the ARA/DP relationship is tarnished to the point of no return. I don't see them double dating or playing naked leapfrog together when this is over.

There has been plenty of time over the past few years for the diehard DP's believers (like @eternallife) to sober up. I'm a recovering loyalist myself. It's just better to face reality now vs. later because it's only a matter of time before this train officially crashes like Silver Streak. I'm not going to standby flicking my pocket pendulum in hopes of light at the end of this tunnel. Anyone who believes I shouldn't stir the pot and take action should collectively pool $8500 together and send it to me.
You do you and I'll do me.

One last post on this before I disappear into the bushes:

DP made a few other rookie business mistakes that I haven't even touched on in this thread. I've already said too much, so I'm not going to talk about them here.

I will say that DP made a mistake by telling us what supplier(s) they were using. No normal company does this.
At the end of the day, did it really matter? I understand that they wanted to give us confidence in their ability to build a product, but they could have sent us photos and whatever else from the factory. We didn't need to know that it was actually ARA who was building the game. Do you know the CM who made your Microsoft Xbox or Sony TV? Of course not! It doesn't matter. If your iPhone fails, you go to Apple -- not Foxconn. In this case, you're buying the pin from DP, not ARA.

This whole mess is exactly why you never reveal your suppliers to customers or end-users. It certainly backfired on DP when they got called out on the MMB issue. Now they're paying for it. ARA pays for it too by having their name & reputation attached to DP.

Am I glad they told us? ABSOLUTELY. It just wasn't a good business decision to do so.

From a reputable source, my understanding is that ARA continued to want to renogitiate the cost of production and parts before the original contract agreed upon was fullfilled.

ARA knew a majority of the deposits and paid in full $’s were being held in the U.S. Funds were released and paid to ARA once the games made it to their rightful owners. That was agreed upon and in the contract as well.

I suspect some greed on ARA’s end. After seeing how much the games were selling for, the demand, ARA wanted a bigger piece of the cut. They figured by the time they had 40 games ready to go, mine being one of them, they could hold off from shipping them and force DP to renogiate or they would sell the games themselves.

I believe the breech of contract happened way in advance by ARA prior to building and delivering the first 300 TBL’s. ARA says otherwise. Suppose and hope some info with regards to the contract details is publicized.

TBL software is useless without the legal right to produce and sell the game.

TBL software can be recreated at will by competent people... but the ability to actually sell the game goes through universal... not Bankrupt DP.

You are assuming ARA got paid. Rumor is they were never paid for the first 50 games that were shipped.

Sorry to all that has Money and Faith in this ...

DP contracted with ARA to assemble 300 games - delivery between April 2015 - October 2015, payment due on delivery of the completed games. ARA completed/delivered 50 games by April 2016.
The numbers come out to less than 20% of the contract completed in over twice the contracted timeline, with over 80% of the contract yet to deliver. Cost increases would not be acceptable or appropriate due to the lack of performance to the contract. If the invoice ARA submitted was incorrect, DP would not have to pay until a correct invoice was received.
One could also speculate that DP has filed a counter claim against ARA for the 250 games not completed by October 2015, the original due date. Add to that the second agreement on price/schedule and additional 50 game run was also broken - again by ARA. Loss of business, reputation, future sales, new CM cost, ect - all go in DP’s favor.
Maybe ARA is suing DP just to close the books and write it off as a loss?

If it ends up with ARA continuing this production ( if their right is proven to do so ) I doubt they care about software/code (in their mind it's $ all the way I guess) and won't get Koen to do it I think (Would Koen work for the company who got his DP team in this situation?? ) and it's a DP asset/creation all the way, nevermind Universal problems on top of that...
Production of more games by ARA on its own won't get done IMO ( Parts in ARA's building is/was not much so 10 games or so I would say, that's what was to be seen a year and a half ago when some of us visited the ARA site , so 40 ish boxed games and 6/8 games on the line plus parts here and there but nothing substantial and I doubt there were some other parts elsewhere in the building as the ARA site is a well organised one and for different companies , no way they have parts for the 200 games remaining to make ).
They can't order parts from vendors , PFs from Mirco and so on , no way they could do this , all they can do if they win the case is sell TBLs for 15K or more to try to make a fast earning (not really at that price IMO ) and get EAs upset and angry too for an extra mess on top of things..
Some would probably lawyer up against them , so ARA is still in a big mess whatever this TBL scenario gets to be..
If DP is all the way right as the info from a year ago is true , ARA had to swallow the extra 1000 $ not DP , but as this thread put up so much possible shit to light we still have to wait for the actual truth to be known.
Jaap and Barry (and DP team) are not dumb and dumber or else , they invented/designed and achived a great pinball machine of the best quality and of Bally/Williams level of play, a unique game of its kind, a real good game, something not to forget.
They need to get proved right and get their act together and I hope it gets better in the next months even if it looks blurry right now.
Hope ARA's lawyers will fruck this up so the Xytech games can continue their life after this and the EAs get their ARA warehouse hostage games for the price they already spent out there.

"What day is this ?"

Sorry, but I need to jump back in while you're still active....

What about the 40 other games sitting in ARA's warehouse? Wouldn't they make it 30% of total production?

Have you read the contract? At what point in the development/production cycle did DP receive an invoice? Did the incorrect invoice suddenly appear before or after the first 50 games?

DP didn't strike first. Why did they wait so long to take action against ARA? They told us they were advised to move on from the 51/49 offer from Nivoge. They seemed pretty confident in their case against ARA, yet didn't take any legal action against them until they were finally subpoenaed. Why didn't they file a lawsuit against ARA back in October 2016 (19 months ago)?

You have to file a lawsuit to write something off as a loss?!

It's impossible to say what really went down in any of those negotiations since none of us were there, and nothing appears to have leaked (not even any rumours on the Dutch grapevine).

However I am sorry to say that Jaap was still showing signs of a massive ego at the time of DPO Expo in November '17, when the new machine was presented. He was venting his spleen about ARA and going on about how it was no fault of theirs and how ARA had it in for them. Regardless of whether it was true or not, no-one wanted to hear it - or we certainly didn't. Both the friend I went with and I were staggered by his attitude.

Barry was a lot more contrite and made most of the right noises. He gave useful information about what was happening with the Xytech TBL and tried to answer all our questions. We were both glad that he was making the visits to China and dealing with things over there. Jaap just kept pulling the conversation back to how ridiculously they had been treated and how mad he was.

It kind of jived with that awful, angry sounding update that was put out earlier in the year that most of us were shocked by.

No refunds is absolutely and totally illegal in the EU. You have until 7 days after the item ships to cancel the contract and receive a full refund. For something that hasn't even shipped even more so.

Everyone assumes DP will win this legal action, I think thats a poor assumption. The costs alone will be significant. If I was DP I'd be ensuring I get a few opinions and to those customers waiting I'd want to see a legal view on likely success of the case - as those customers paid for pinball machines not legal expertise.

Neil.

that would worry me a great deal!

DP supplier problems and legal problems are not your problem
Mortgage their homes and refund you all. SIMPLE.

What will the community think of a buyer who might acquire a machine from a hypothetical auction of the machines in a liquidation? If ARA gets to sell them, they would not owe them to the original buyers.

I think you are high if you think ara wants to be in the pinball business as themselves

They did want 51% share in DP , so wouldn't that indicate they wanted to be in the pinball business