One of Electronic Arts’ biggest money makers, Madden NFL Football, is the basis of a law suit by its developer, Robin Antonick. The stakes are quite high if Antonick gets everything he is asking for. That includes not only past and future royalties with interest, but the profit EA made on the game and its spin offs.
Profits have been estimated at $4 billion for more than 85 million sold copies on the Madden versions alone since the video game hit the streets more than 20 years ago. Royalties range from 15 percent to one-half of one percent depending on the time frame. The law suit seeks interest also, which at today’s rates is hardly a talking point. However, when you add punitive damages, one wonders how EA will recover if Plaintiff Antonick wins.
Specifically, the suit asks in its Prayer for Relief for "Disgorgement of all profits earned by Defendant from sale of Madden videogame franchise, NCAA Football video game franchise, and any other video game franchise utilizing the intellectual property of Plaintiff. Interest on such monetary relief." Doesn’t look like EA has a prayer of getting out of this one. The suit also asks to recover attorney fees and the cost of the suit which at the time of filing amounted to $900 in fees, a drop in the bucket considering the full impact of any judgment.
Breach of contract and fraud form the basis of the lawsuit citing EA’s fraudulent failure to pay royalties, widespread use of Antonick’s intellectual property not only in Madden games, but other areas, and a pattern of intellectual property misappropriation. EA’s hockey game was also noted as involving aspects of Antonick’s work. A tag line on the product is "Slapshot puts a hockey stick fight in your hands". Looks like Antonick has a stick of his own aimed not at a puck, but at EA’s bank account.
This all started back in 1986 with a development contract between Antonick and EA. Antonick developed the first version of the Madden NFL Football video game for the Apple II, Commodore 64, and MS-DOS. When the game was released on Apple II in 1988, his name was listed as developer. Because of the limited processing power of the hardware at that time, the simulation of a properly populated football game was thought to be impossible. Static and predictable game play by a maximum of five members per team was the norm.
Antonick, instead, was able to field a full game of 11 players on each team and equip them with unpredictable and adaptive moves on the Apple II. EA contracted with Antonick to develop and bring the prototype to a viable commercial product for which he was to be paid for the development, and to receive "royalties on each sale of 15 percent, with 5 percent on any works developed by EA derived from his work." That derivation clause is a fly in the ointment. Although the original contract was amended over and over as work progressed, notably in 1986, it was never set aside.
The case emphasizes Antonick’s combination of football knowledge gained from personal collegiate experience and his own creativity and programming skills, and rests upon EA’s supposed purposeful deceitful actions. As supporting evidence, it is noted that EA signed Madden who worked with Antonick who translated the Oakland Raider football coach’s play book and play calls into computer algorithms.
Previously, statistics were the basis for such programs. The suit contends that this required a rare combination of skills, programming, and football knowledge. In an LA Times interview, Madden said: "The reason I joined him [Trip Hawkins, EA founder] was that I wanted to make something that could teach football. Then it took us years to get to that point."
Antonick also worked on the Sega and Nintendo platforms with an amendment to his royalty rate for these derivative works. EA pulled a quarterback sneak by farming out a Sega Genesis version to Park Place Productions, rather than giving contractually-promised first right of refusal to Antonick. The suit notes that, curiously, that version was delivered in six months, in contrast to the four years it took for the original to be devised and delivered. The suit indicates that this would not have been possible with only the inexperienced, sports knowledge challenged, programmer Simmons who was assigned to the project. Instead it could not have been completed "without the substantial input of EA and the intellectual property of Antonick". Richard Hilleman had worked hand in hand with Antonick at EA, then worked alongside the programmer at Park.
In respect to his game going onto Nintendo, the suit contends that EA made false statements that lead Antonick to agree to yet another amendment to his contract. It terminating his rights solely with respect to the John Madden football software program for the Nintendo Entertainment System, leaving all other provisions in full force. However, thereafter Antonick’s copyright notice did not appear on any version of Madden. Additionally, EA provided Antonick with fictitious royalty statements indicating no royalties were due. His last royalty check came in 1992 as John Madden Football ’93 was coming out.
All this occurred decades ago. Why has Antonick just recently come up out of the fog and begun beating the drum to get paid? Why doesn’t the statute of limitations apply? First, Antonick, trusting soul that he appears to be, if not simply naïve, didn’t realize his code was used as the basis for what EA and Park subsequently created, until the 20th Anniversary of the Madden series. During an interview with EA founder Trip Hawkins where he "expressly traces the origin of the Madden software to the 1988 version developed by Antonick" that Antonick became conscious that he’d been duped. In meanwhile, Trip Hawkins dismissed the Antonick’s lawsuit. Then again, Trip Hawkins himself has a lot of legal issues with the IRS, claimed to owe them about 20 million U.S. Dollars.
As to the time frame involved, California adopted a continuing royalty doctrine, negating the statute of limitations as applied in this case. Additionally, the statute is mute since EA is being accused of fraud and making false statements which Antonick relied upon. Essentially, EA lied, misleading Antonick to believe that they had developed subsequent versions of the Madden series independent of his original work. However innovations, such as Antonick’s instant replay technologies show up in subsequent EA releases.
NHL 11, a hockey video game, was developed by EA Canada in Burnaby, B.C. following a four year agreement signed in 2010 between the Canadian Hockey League
Antonick and EA were having friendly little chats trying to solve their differences, but that dissolved into a court battle, complete with jury. The on-line copy of the filing is redacted, meaning pertinent parts, such as client attorney privilege, or trade secrets, have been blacked out, but the main points are clearly visible.
Antonick’s law suit contends that a "1986 Contract has never been terminated and remains in force to this day." Additionally, Article 102 states that EA’s use of Antonick’s intellectual property likely extends far beyond the Madden franchise. To bolster their position, Article 111 states that EA has also become notorious for using the names and likenesses of individual without their permission.
John Blackburn, a lawyer and professor of business law at Ohio State University, told E-Commerce Times ".. this could be an open and shut case… The defendant will probably be asked to surrender internal programming code to the court, and if the plaintiff can link anything from that code to his original product, there should be no question as to the defendant’s liability." On the other hand, the request to relinquish the profits to Antonick is questionable. Blackburn continues: "?disgorgement is used in cases of extreme illegal or unethical acts. ? Antonick would essentially have to prove that EA could not have earned those profits without its alleged fraud, which is unlikely, because by Antonick’s own admission, the series could have continued without his Madden algorithms."
Currently, stockholders don’t seem concerned. On Nasdaq, ERTS which shows a 52 week range of $14.06 ? $20.24, doesn’t seem damaged by the recent revelations. Today, it sits comfortably high at $19.93. Still the Madden Curse a phrase coined because athletes appearing on the cover of the video game have been prone to suffer injuries, may turn back on Electronic Arts itself.
Of course, it has been reported that an EA spokesperson says the suit is entirely without merit. However, a couple of lawsuits that EA has already lost lends credence to the Madden-related claims. If Antonick wins, it could mean the end of the Madden series as we know it, since it could require the complete rewriting of the basis of the game by EA without the benefit of Antonick’s code.