Quoted from ectobar:
The nerve! How dare I make a reference from the movie in the ad.
How does the rug look in your game room?
Quoted from wcbrandes:
Is it even legal, of course given the jurisdiction, to sell a product to a new customer when there are 150 people waiting for theirs and have prepaid for the exact same product they will be producing and selling? I would love to ask a lawyer who specializes in this arena. For some reason it goes against by better judgement and I would think the line is getting crossed somewhere.
In America the customers in line can sue for breach of contract if the terms of their contract were violated. Selling a pin to someone else first is not likely something that would breach that contract but I don’t have one to read. So to answer your question the scenario you describe (by itself) is not likely actionable.
I’ll set aside an analysis about whether suing would even matter at this point (no assets to get back...)
I think you guys are owed a better explanation. It sound like they have received an initial lawsuit which they have counter claimed but it doesn’t speak to it being an injunction forcing them to stop production. Companies are sued for damages all the time and continue to operate unless an injunction is issued (I’m talking American law here since I don’t know Dutch law).
Without more details (are the court documents public?) it seems to me they are using this event as an excuse to officially announce the shut down. It isn’t that the suit actually CAUSED the shut down... maybe this is their way of deflecting their failure by closing at the same time the lawsuit came out.
Quoted from rubberducks:
I doubt Xytech would want to go ahead with production if there was a hanging legal judgement, the result of which could entail another party vying for the monies they hope to be paid.
Of course they would go into production. If they are paid up front or paid reasonably close to as they produce they will produce the product unless a court order forbids them to. If DP can’t pay them upfront then they were no worse off after the lawsuit than they were before it.
Companies do business all the time like this. They just take a few more steps to protect themselves. A lawsuit with a prior manufacturer is incredibly common.
Again I really believe they are using this lawsuit as an excuse to close... not that it caused the closure. Can anyone local work on finding out of the court documents are available publicly? In nearly every jurisdiction in America they would be. Sometimes online even.
Quoted from flynnibus:
And now you found the magic phrase... IF THEY ARE PAID. DP had no way to fund the full build. One has to assume the new partnership is again one where the manufacturer is taking something in lieu of outright payment. If the ability to sell said product is in limbo, anyone in an arrangement where that is important.. is going to pause and reconsider how far they want to get in.
I agree with you 100% but this lawsuit doesn’t make them any more or less able to pay (unless it was an injunction on production). If it was just a suit for damages demanding payment for past items built it shouldn’t stop them from going forward... at least it wouldn’t stop them in America. To stress I’d love to see what the “subpoena” DP references actually is.
Again to be clear - this lawsuit doesn’t put DP in a worse position to pay for games up front. They were already in that position before the lawsuit. This is why I have a suspicion they are using the lawsuit as a final excuse to tell everyone what they were going to tell them all along...
Quoted from jeffspinballpalace:
Following questions are aimed at the world's greatest legal minds of Pinside: Suppose there are 50 fully built TBL in crates and there exist enough parts to build 50 complete games. Nobody has a license to make and sell more TBL games and we don't know who will end up possessing these games. But after the cases are resolved...
1) If the games exist, can the owning party openly sell the 50 TBL's, given they were made at a time the license was active?
2) Could 50 games be "assembled" from the parts be openly sold under the original license agreement described above OR would they be forced to build and deliver them for free to the next 50 EA's on the list?
1. Depends on the license terms. Assuming the license fees were paid the games should be a licensed product capable of being resold. Would need the license agreement to know for sure but any decent lawyer would have made it so stock could be sold after the license expires (just as long as fees were paid up!) Your question(s) focus on licensing rights but the issue here appears to be that someone is holding an asset because they haven’t been paid. Two entirely different issues.
2. I don’t know if I understand the second question. It seems to relate to the license agreement and, again, we’d need its terms.
Remember that contracts are a series of promises which when broken trigger the ability to seek remedy. If all the license holder is entitled to was $X per game and they were paid that then no harm no foul and the license agreement isn’t violated if the games get released after the manufacturer litigation is resolved. I would guess the agreement has a tail in it to sell existing stock but some governor to prevent someone from selling licensed items way beyond the intended time period.
I stress this is all generalized from my experience and I have not seen the DP contract.
What I will say - and I’m sorry to say it because no one will appreciate hearing it... under US law someone who pre pays for something becomes an unsecured creditor. When a company goes under a lot of people are in front of the unsecured. So if your questions surround whether the 50 games get released to you eventually I think your biggest threat isn’t the license agreement... it is the line of OTHER creditors that will acquire the games first. (I’m applying American law here I can’t speak for Dutch or EU laws). If DP is forced to liquidate those games may be sold to pay creditors...
Quoted from highdef:
That statement definitely proves you are NOT well-versed on the law. DP doesn't do business in any US state. Jurisdiction falls under The Netherlands, therefore, you can't sue DP in Small Claims here in the US.
Your contract dictates where you can sue. If the contract is silent then other facts dictate where you can sue. There is a strong chance he can sue in California. The real issue is he has no contract with Universal. That is what makes it difficult and potentially pointless.
Edit: I’m not sure if these threads were talking about a suit against Universal or DP...
Quoted from highdef:
Not in Small Claims!
The Netherlands has jurisdiction because the contract was performed in part there and because the defendant is based there.
A recent U.S. Supreme Court decision, Daimler A.G. v. Bauman, 134 S. Ct. 746 (2014), held that a company can be sued on any matter ONLY where it is "at home" (i.e. has a headquarters or near equivalent secondary headquarters, or if it is organized under that jurisdiction's laws), and otherwise can only be sued in a place that has a significant connection to the subject-matter of the particular lawsuit.
Please don’t quote or cite cases to confuse people. That case’s facts and circumstances are not the same. It involved a foreign company and a subsidiary... completely different situation as far as I can tell.
Let’s leave it at this - owners that want to take legal action should bring their contracts to a lawyer qualified to practice in their home state. Chances are you are going to get a judgment against a bankrupt company but that is your choice.
highdef- I don’t want to get into a legal argument (that isn’t relevant to the DP mess) here or convince you of the law or why that case is different than the one we are discussing. I’m just politely asking you not to post information which may confuse or discourage someone from pursuing an attorney licensed in their state to answer any questions they have. If anyone here is located in Connecticut, Rhode Island or NY and wants to PM me to discuss their specific circumstances I’ll assist as a favor to a fellow pinsider.
Quoted from Adams:
You're correct it would be difficult to gain standing in any state court. Maybe possible in federal court, but even if you could, it's not practical for loads of other reasons.
Please be careful when you make statements like this. Unless you have read the sales contract that applies no one can make this statement and be accurate. There is a reasonable chance people have standing in state court but no one could say for sure without seeing a contract or knowing what state the transaction occurred in.
Whether they want to throw more good money at this to get a judgment against a company that may be bankrupt is a separate issue...
My only goal here is to prevent incorrect information on the law being spread. It tends to occur in threads like this. I would politely ask everyone to stop making statements of law which may discourage or mislead others.
Quoted from Tuna_Delight:
FYI (and FWIW) to all: I emailed Barry and Jaap yesterday asking how long they anticipate that this may take in court and Jaap responded back that it will take at least 8-9 months according to their attorney. Jaap also stated that it will all depend on the court's decision, but I'm not sure whether he was referring to the duration or the outcome.
They owe you an explanation of what the lawsuit actually is what it claims and how exactly it is stopping them from moving forward. You guys (the “investors”) are owed at least that.
Quoted from Mr68:
Both companies are frozen from doing anything independent during litigation.
How do you know this? What is this statement based on? Companies operate under litigation all the time. The only thing that stops them is an injunction and no one (even DP) claims one of those exists.
Quoted from Mr68:
It's my assumption based on experience. Neither ARA nor Dutch Pinball can transfer those Lebowski machines as they are in dispute. Please read the post I was responding to. I may have worded my comment poorly and unintentionally mislead you.
If European law allows ARA to sell those games during litigation, independent of DP, I'll gladly be corrected and completely surprised.
If all you are referring to was doing something with the already built games I agree that is likely the case...
Quoted from Ballypinball:
They did want 51% share in DP , so wouldn't that indicate they wanted to be in the pinball business
Not necessarily. I’ve seen many people or companies in broken down deals take an equity portion to settle debt and or to control a company they were trying to get paid from. They become reluctant owners and usually look to sell out quickly if the company survives long enough to pay them. The only way we’d know for sure either way is if they tell us...
My guess is that it was all about ARA getting paid and nothing more but just a guess.
Quoted from jeffspinballpalace:
Going to restate the obvious, because some can't accept the truth ... here it is.
Nobody will manufacture any more TBL's, ever. There will be limited to no customer support for any TBL. Time to put a fork in and to puncture any hopes of someone emerging from ashes to begin making future TBL's now.
When the Dutch lawsuit is over, ARA or DP will be owed a lot of money. It will be difficult for the party who owes to pay. There may be 40 machines already made and there may not be. If they exist, they will be awarded to one party and that party will wish to sell them immediately thereafter, if legal. Proceeds from those games will go to company selling them.
Any additional lawsuits against DP, such as ones originating from US, if successful will not have any machines left from which to go after. At that point, lawsuits are targeting a money settlement against DP. If DP is successful and if they collect damages against ARA (maybe 10% chance overall), they will be able to pay off a portion of the lawsuit.
Sadly I think this is the best guess / summary of the situation here. Current buyers are unsecured creditors... unfortunately.
I wonder if any locals can get the court documents? Some jurisdictions in the US make everything available to the public but you must go in person (they don’t put it online for convenience). Others put it all online. Perhaps the case here is available at the court itself? Anyone who speaks the language could call the clerk.
Quoted from EternalLife:
ARA and DP signed a contract that says that DP will buy 300 TBLs from ARA, delivered between April and October 2015.
ARA informs DP that the agreed price is too low because the cost price is higher than estimated. DP agrees with the new price.
First shipment of TBL.
ARA metrics. 300 delivered games, April-October 2015 - 210 days.
First delivery of only 50 games - 420 days later
ARA's numbers are: 16% delivery , 200% late on schedule, 25-30% over on price. Horrible numbers, they failed in every category. If there were major board issues, ARA made the board set so ARA fails again in the 4th category- quality.
In the US you can sue the CM for loss of reputation, business, damages, ect if they fail to meet the contract.
If the law in the NL is the same, the numbers suggest ARA is not in a good position.
If ARA has to pay DP for the 250 TBL's they couldn't produce on time on budget DP will walk away with everything they need to finish the original project, and a lot more.
If all this is true (and IF is the key word) one thing really confuses me... why didn’t DP sue earlier? They would have had an open and shut case and an easy win. Instead they waited to be sued (and counter claimed according to their communication). If they were wronged so badly they should have sued first. Have they explained this? Seems like something is missing here...
People can take sides all they want - there is clearly a bunch of missing information no matter how much we beat this thread to death.
Quoted from sd_tom:
agree but they did provide a reason at the time, lame or not, was that they didn't want to delay production by spending $$ and energy doing lawsuit vs walking away and finding another manufacturer.
all very undude like.
Definitely a lame excuse. The lawsuit doesn’t delay anything. It would drain money obviously... but not delay anything else. Anyone who thinks logically realizes the argument is like this “I have been wronged by hundreds of thousands if not millions of dollars... but I’m going to let that slide...”
In my experience people usually say they didn’t want to litigate because they were in the wrong and they know it. They don’t want to “waste” money on something they can’t win.
I think I’m just going to get out of this thread until some actual information comes out.
Right now it is basically like a political argument... two sides talking to each other but not listening. No one is going to change each other’s minds so it is best to wait for court documents or any other real actual info that becomes available.
The problems are so circular it’s impossible (and almost pointless) to decide where they started or where they can end.
In that email it appears DP balks at 30 day payment terms back in June 2016. Does this mean all the money to pay for the machines was gone at that time? If so, doesn’t this letter point to the real problem — a company was struggling to build machines because it ran out of capital?
Nothing above explains what claim ARA made when they started the lawsuit nor does it explain what DP’s counterclaim was.
I’m just not sure we have any more info now... really...
Quoted from titanpenguin:
Payment terms in business typically are net 30-60 days. I think they are going for clarification. I’ve seen them set at 45, or even 120 days out. Negotiating the terms is not unusual or suspect at all.
I understand that. They make reference to their accounting books having been shown to ARA and it could almost be inferred that it is more than a simple 30-90 day lag.
Regardless - I think we all want to see or hear what claims are made on each side in the lawsuit. Giving us old emails doesn’t provide context on the claims themselves.
Quoted from Rensh:
Why the negative approach?? You could also see it as an attempt to have enough funds to fight of ARA.
But apparently everything DP does is explained negative
Perhaps they should explain how if they can’t pay legal bills they intend to get machines built? Isn’t it fair for a plan to be explained before one asks for people to join in? Then again, these guys appear to be used to blind commitment without explanation or rationale... so I don’t think it’s DPs fault.
Oh well. People are free to do with their money as they please. I would implore anyone looking to donate to think hard and consider directing the money to a charitable cause instead. Childhood cancer, animal shelters... etc.
Anyone else notice the PayPal address on the go fund me is a dutchpinball.com address?
Does that mean DP is behind this or at least directly getting the money?
Not that this info makes me want to donate... especially given the lack of any useful information to perspective donors or current customers.
Quoted from phil-lee:
Lebowski will be a Case Study for lawyers in the near future, where the primary Market originates from a foreign Country (USA) with substantial losses yet no active litigation.
Be the fly in the ointment, legally challenge before the time runs out.
As a lawyer (who for the record did not buy in and who is NOT providing legal advice in this post) it isn’t a case study in my opinion. It is a situation where a company that took a bunch of deposits went (essentially but I don’t think officially) bankrupt. People often don’t pursue cases like this. Throwing good money after bad so to speak. EAs would be at the bottom of the food chain to collect money in the US. I suspect Dutch law is similar (but I don’t know). Blood does not come out of stones no matter how many lawyers you give swords to.
A lot of people have a lot of opinions here on what should happen. The law is different... and the reality is that the current proceedings haven’t been published anywhere that I’m aware of so (like everyone else) I’m just making my best guess at the situation given all the circumstances.
I would suggest that we shouldn’t all be so quick to tell the EAs what to do. Or criticize their “inaction”. I suspect many have researched and maneuvered behind the scenes to preserve rights if it makes sense.
This entire thing is sad for those that lost money and sad for the community that loves pinball because it looks like a great game.
Quoted from phil-lee:
They already are. Can't go lower. The squeaky wheel gets the grease.
I would rather use an Attorney that is optimistic when versus Goliath. Not "Just take your club to the head Son".
Make the attorney take the case completely contingent on recovering and see how optimistic he or she is. Offer them 2x their rates if successful and see if they take the deal.
Quoted from Nikonokin:
Does anyone here have a personal relationship with Roger Sharpe? Another thing I've been discussing with a lawyer is if the Judge rules in favor of ARA and for some reason they think they can sell/auction the machines we quickly go after that breach.
I am willing to do whatever necessary to forcefully (legally) stop ARA's ability to infringe on Universal's license, they are not authorized to sell these. I'd think we'd have a road forward putting both Universal & ARA on notice. Getting Universal on board would be best. I'm still waiting for Barry & Jaap to do the right thing but otherwise we need to force the hand. While a class auction lawsuit against DP might not be fruitful, ARA and Universal have much more to protect, and deeper pockets. I'd think with the help of an expert and Universal we could figure this out.
Every day that goes by at this point is scary. Please reach out to us Barry & Jaap...
I haven’t read the license agreement and I’m not sure if you have but I’m willing to bet reselling games manufactured under license that was paid for (if it was paid for) doesn’t violate Universal’s rights. It would be no different than me reselling the GB machine I have in my basement.
Remember your contract is with DP. How that gets to you to a claim against ARA or Universal isn’t clear to me...
When you say “go after that breach” in your second sentence what breach are you referring to?
To put it more simply - if you pay your local grocery store $5 for milk to be delivered and they take your money you can’t sue the dairy farmer... even if the farmer is physically holding your milk. Your complaint is with the person who took your money and failed to deliver.
Rensh: what is the plan now? If I read your message correctly Barry is “free” of the ARA claim but I have to guess he has no capital and potentially other debts. What is his next move? Bank loan? Investors? Or is he going to build and sell machines 1 by 1 (no pre orders pay as built I’m guessing?)
The latter seems like the most likely solution but probably easier said than done since some capital will be necessary to set up manufacturing.
I won’t comment on the history of this or the case or my opinion any further. I learned many posts ago everyone in this thread will believe whatever they want to believe no matter what the law (or logic) says. At this point I’m just curious what happens next if anything...
I could be wrong (I often am) but I’m not so positive there is a market for 500 games at $12.5k or that they could roll them off the assembly line at that price on a long term basis. Maybe if they announced that is ALL that is being made they could get that price... but if manufacturing was ongoing (assuming the license could go past Dec 2020) I think the market calms down and sales would really slow at that price.
Remember people are often quick to sign up for things and even to put deposits down on games only to cancel later. How many people here were deep on lists waiting for NIB games and got moved to the top of the list when others dropped out?
I wonder if partnering with Stern/CGC/someone else to manufacturer gets the quality and speed of production up to maximize the license time and consumer confidence... ??? My guess (pure guess) is that the capital needed to get those guys going is too high for DP right now.
No great choices to move forward but I give Barry credit for trying and I hope everyone who paid gets a game someday.
Quoted from jeffspinballpalace:
If DP were an American company, the EA's (largest group of creditors) would have filed suit and forced them into bankruptcy. As a result they may have gotten 20 cents on the dollar. Instead they do nothing and DP is still in business, so they will get nothing! DP has gotten a free pass from EA's for far too
I’m not an EA but your statement is not entirely fair or accurate.
First we don’t know about DPs creditors or its assets. Second - in US law they would be unsecured creditors which is important to understand. I don’t practice law in the Netherlands but if it matches the US the unsecured creditors are at the bottom and in every liquidation scenario I have seen they get nothing by the time all is said and done. In BK you can be almost certain ARA (a supplier) would have been paid ahead of unsecured creditors and EAs wouldn’t have gotten anything.
I just don’t think it is fair to imply people missed an opportunity that you don’t know existed and based on my experience in US law I would be willing to bet never existed. Could a few have made noise and gotten their money out before it was too late? Probably. I believe some did in fact. Could all of them? No... forcing the company to bankruptcy would have almost certainly eliminated any chance they have (however large or small that chance is) at getting anything.
Being an unsecured creditor is a tough lesson for many. Gift cards, deposits, etc are all unsecured. People often don’t learn how limited that makes their recourse until it is too late.
Quoted from LITZ:
What are the extra doodads that we EAs get if we decide to fork over the extra 4K? Perhaps its the other kind of Dutch "trim" that he is referencing?
You’ll never get an answer to this. Why let details or facts or information come into play now?
The fear of missing out (as referenced by Ben earlier) has almost 100% driven this entire catastrophe. I don’t see that changing anytime soon.
EAs pretty much have to decide if this game is worth $20k to them. That is what they will have paid. That second game isn’t likely ever going to arrive.
The big question is very simple - how many games need to be sold for each EA game being built? This detail is completely left out. Is it X sales for every EA to get a game... or is it the EAs get built totally last? He referenced “in parallel” so it sounds like the former but still... do the first 100 or 200 have to be all new sales?
Lots of ins and outs left to be explained.
I want to see every EA get their game but I’m fearful the market for $12k games isn’t as predicted. I hope I’m wrong. I’d love to own this game one day.
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