Kohnke Communications, a public relations firm which represents a number of MMO developers, is suing Perpetual Entertainment for breach of contract, several counts of fraud, and transferring assets, including Star Trek Online, to a new company before liquidating their assets. The suit also claims that Gods and Heroes was canceled so that PE could avoid payments owed to Kohnke on the game's launch. Ten Ton Hammer has obtained court documents, and has further details on this story.
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December 11, 2007 - Details surrounding Perpetual Entertainment's dealings subsequent to the cancellation of Gods & Heroes are coming to light as Ten Ton Hammer uncovered court documents of a new complaint just submitted to California's Superior Court last week. The allegation: the San Francisco-based developer fraudulently transferred valuable assets (like the Star Trek Online license) to an insider-owned corporation at a loss, leaving those with a financial stake in the now-defunct MMORPG Gods & Heroes: Rome Rising without hope of payment save legal recourse.
According to documents received last Friday in California's Superior Court for the County of San Francisco, public relations firm Kohnke Communications, Inc. – best known for promoting the efforts of numerous MMORPG developers like EA Mythic, Red 5, Turbine, and NetDevil – is suing Perpetual Entertainment, Inc. for breach of contract, fraudulent transfer, fraud, and various other charges for damages between $80,000 and $290,000, perhaps much more in terms of punitive or exemplary damages.
The complaints stem from allegations that Perpetual sold valuable assets like the Star Trek Online (STO) license to P2 Entertainment, Inc., a thinly veiled yet separate corporate entity, before executing the Perpetual ABC or "Assignment for the Benefit of Creditors" (a liquidation mechanism allowed by states like California as a less expensive alternative to the extensive litigation surrounding bankruptcy). The case could have drastic implications for future of the pre-alpha Star Trek Online title.
Read the full story on Ten Ton Hammer.
I can't see any way out of this for PE. What a shady affair.
Morons. This is one reason why gamers have little to no faith in Dev companies. Investors can't trust Devs either apparently. Stuff like this will negatively affect the selection of future MMOs as potential investors become more and more wary of funding the development of some game that may, but most likely won't, ever make it to market.
IF this lawsuit ends up in finding PE guilty and liable of damages to the PR firm, then that should be reason enough to boycott STO.
I think this is the nail in the coffin for Star Trek Online. What a shame too...I was really looking forward to this. :(
Oh yeah, the final nail in Star Trek Gaming in general! Oh, just wait for Daron to spin this news somehow to his loyal Kool Aid drinkers over at STO-NET!
Perpetual wont survive this law suit there already in huge trouble, key word "liquidation" says it all really and means the STO mmo shall enter limbo until another company comes along and breathes life into it.
sto.net arent exactly trying to spin this as positive, I dont think even daron can spin this one, and if he tries, I doubt anyone is going to believe it after this.
From what it looks like right now, I hope another company will start over with the IP, and take it to another direction, one where no man (or dev) has gone before... and make an original game off a familiar IP.
Well I guess that this means no 2008 release.
But seriously, all but 2 of the posters over at STO.net are fairly disappointed in PE, and the other two are just hopeful that Stinnett has an explination.
In my opinion, I think its likely Stinnet and the other top management at PE/P2/Perpetual LLC are looking at travel brochures and thinking about leaving the country.
I certainly hope this is the final nail in the coffin of this Star Treck thing... and I hope some nice devs finally pick up that IP!!! (much like, thanks god the first Warhammer online was cancelled to make place to this new one!!!)
Well I did a little research and found this:
[Cal. Civ. Code § 3439.04]
NOTE: California provides both civil and criminal penalties against a debtor who fraudulently moves property out of the state with the intent to defraud that can range up to $1,000 or 1-year imprisonment or both. [Cal. Penal Code § 154(a)] If the property transferred is greater than $100 then the crime is a felony. [Cal. Penal Code § 154]
So, besides the debt and possibe fines, Joe Keene, Chris McKibbin, Richard Zinser and the famous Daron Stinnett are looking at possibly spending a year in jail.
Perpetual = Farlan
Need I say more? It is really such a shame, considered that Gods & Heroes was pretty good in beta. This company could have done something good, but seems to have made all the wrong decisions, just like Farlan Entertainment did with Dark and Light.
Wow... just wow. It seemed strange that the company could sell off assets to a clone company before paying off their debts, and obviously they were called on it. It's a real shame that all of this has happened.
wow some of them at sto.net are the definition of real fanboi's and i'm not using that in a bad way, its just even with this new news ontop of all the other crap they still want to believe in PE. I had bad feelings about this company and little by little they keep coming true, even if they settle this out of court or something there is now way in hell i would give PE any of my money ever.
They could give it to Bethsoft which made Legacy and have experience in the MMO and they have the IP on Startrek they could perhaps get the IP on the STO MMO. Though who would want the IP on the MMO though? Who would really want it after this has been one terrible thing after another. Perhaps its best to allow STO to RIP and the franchise as well.
Though iam not surprised, though after Daron and his spin in the end of Nov about the liquidation of PE this guys has no bounds when it comes to his Kool Aid drinking spin when all the liquidation was public record he still spins. PE had no place building any game, i think the final nail in Star Trek gaming has just occurred. Startrek gaming is cursed franchise.
I guess this is the final straw. I could see the Star Trek License getting pulled from PE, and I hope it does. Let us just pray another compitent company will pick up the license and start the game from scratch!
"
Perpetual News
BioWare Corp. Licenses Perpetual Entertainment's Online Technology Platform for Upcoming MMO Game
June 28, 2007 - BioWare's Austin studio has licensed Perpetual's online technology platform for an upcoming Massively Multiplayer Online (MMO) title. The agreement gives BioWare - the company best known for their award-winning Baldur's Gate™ and Neverwinter Nights™ series, as well as the 2003 Game of the Year, Star Wars®: Knights of the Old Republic™ - the platform to deploy and support its online titles utilizing Perpetual's industry-leading technology for online game operations, deployment, infrastructure development, and community support."
Seeing Bioware have the tech the original STO is based on they could take up the license, does sound nice but what would lucasarts say about that?
A KOTOR mmo = more like KOTOR for the Wii
A Bioware STO = Yes please!
Bioware bought the payment/support systems from Perpetual, but with Bioware being bought out, pending the end of this year, I think EA is going to replace Perpetual's system with their own.
I dont see Bioware ending up with STO. I could see EA, but I dont know about that.
What I'm interested in seeing is, will STO be thrown up for auction, and who's going to buy it? What is Gravity going to be doing about their wht, 8? 9 million loss from Perpetual? It would be interesting to see them finally end up with the STO license.
As for Perpetual, who's to say they even did any development? There has been very little evidence of anything workable in the beginning. This may have been their plan from the beginning, defraud debtors and run off with their money and license to a valuable IP.
Well that's the end of STO... shame.
well, I certainly wouldn't give money to a company that conducts themselves this way...
I'm confused. Why does everyone think this is going to be the end of STO? The game is starting out with bad press, but that just means more people will know about the game when it finally comes out. The value of the Star Trek IP is immense, right up there with Star Wars... so why would anyone pass on such a possibility?
posted by SlaserX
"Bioware bought the payment/support systems from Perpetual, but with Bioware being bought out, pending the end of this year, I think EA is going to replace Perpetual's system with their own.
I dont see Bioware ending up with STO. I could see EA, but I dont know about that.
What I'm interested in seeing is, will STO be thrown up for auction, and who's going to buy it? What is Gravity going to be doing about their wht, 8? 9 million loss from Perpetual? It would be interesting to see them finally end up with the STO license.
As for Perpetual, who's to say they even did any development? There has been very little evidence of anything workable in the beginning. This may have been their plan from the beginning, defraud debtors and run off with their money and license to a valuable IP."
There is one company thats taken a well loved IP and has actually got the respect and love from the IP's fan base which is a very hard thing to do and that company is Turbine with Lord of the rings.
As for that screen shot, the first time i seen it i instantly thought it looked remarkably like SWG's Jump to lightspeed
PS. sorry forgot to quote so just pasted :p
Its not just about the money, the license is also at stake here. As it could be found to have been illegally transfered (IE: the Fraud part).
[quote]The complaints stem from allegations that Perpetual sold valuable assets like the Star Trek Online (STO) license to P2 Entertainment, Inc., a thinly veiled yet separate corporate entity, before executing the Perpetual ABC or "Assignment for the Benefit of Creditors" (a liquidation mechanism allowed by states like California as a less expensive alternative to the extensive litigation surrounding bankruptcy). The case could have drastic implications for future of the pre-alpha Star Trek Online title.[/quote]
ADD version: PE was dieing, made a copy company (same people ETC...), sold them the license (on the cheep), there by removing a potential item(s) that could have been sold to pay off debits. Basically, gutting the cow, and leaving the empty shell (proped up with sticks) to the wolves (People they owe money to).
This should help illustrate whats happened.
I think this is great news for Star Trek MMORPG fans across the globe. Hopefully Star Trek's license will now be pulled and given to a more competent company.
Uh... yeah, I can read dude. I know what this is all about, but as I said above, I dont know why people in this thread are saying "the sky is falling oh noes its over no STO, etc." Hence the point of my post, hence the point you missed.
After seeing the first screenshot that was posted and some of the stuff Perpetual says they plan on doing with the game quite frankly I hope someone else gets the IP. Perpetuals buisness ethics just reinforce the need for a new dev for STO.
Because the sky IS falling?
PE will not be making STO?
Because this means the ST IP will not see the light of day as a MMO for many more years yet?
You don't seem to grasp what this means if they are found guilty, christ, they dont even need to be found guilty,.
They dont even have a publisher... you really think they are going to find one now?
A summary from the Court Documents
HHHAHAAHAHAHAAAHAHAHAHAHAHAHAAHhahahhAHhahAHAHaHhaHahaHAahhaaaaaaaaaaa!!!!!!!!!
Ok, I'm done.
Wait..........
HAHAHAHAHAHHAhhhaahhaHAAhAHaHaahahaAhhhhhhhAAAaaAAAAAAAAAAAA!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
lulz
I found none of this surprising at all. They pretty much told us this was exactly what they were doing.
I look at this as a blessing - as the STO license will get striped away and hopefully someone that can do the title justice will end up with it.
Oh ya I almost forgot - HaaaaaaaaaaaaaHaaaaaaaaaaaaaHaaaaaaaaaaaaaaaaaaaa!
Am I dreaming? I'm too happy to be awake.
Damn, I wish I wasn't right. I posted they were pulling a "Horizons" with this one and it looks like they did. I can't see STO ever making the light of day now.
This is truly a great day!
PE will not get a chance to brutalize the trekkies with their unethical and fraudulent business practices. It is about time people finally realized what a garbage company PE is. They can't sink fast enough for me.
I wouldn't worry too much about the Star Trek IP, perhaps they will be actually picked up by a company that is worth a modicum of respect this time round.
Agreed... PE never deserved to be trusted with something as important as the IP; can't wait to see which company gets it this time. Hopefully one who knows what the f**k they're doing and has actual experience.
I hope they get in major debt cause of this, and sell off the STO rights to try and gain back some cash.
Seriously why can no one make an MMO we all want anymore?
Why do people do this get rich quick bull? it bugs me to all sorts of things.
-Jive
This is actually good news to me. While the chances of seeing a Star Trek MMO in the near future has diminished greatly; there is still hope that a better, more reputable and competent developer will pick it up. Again I refere to LOTRO. It came back from the brink of oblivion with Sierra and Turbine made it into a fairly decent MMO. Hopefully someone can do the same for STO.
Heh,
Im not surprised. This is just the thing the Star Trek franchise has been stearing for. Paramount treats thier property like a goverment contract. Go for the lowest bid. Maybe they learned a lesson on how they should reguard this property. At this point they probably want to drop the concept of STO as designed with PE. Why? They got a new ST movie coming and this will not promote that venture. Further, if the movie bombs, they might not want to flog this pony, again. I love Star Trek and hope better but I just don't trust the "suits" much.
If there is truth to the BioWare report...cool. I just dont have faith in this anymore.
Long lived but not prospering...
What moron gave them the rights to make Star Trek mmo in the first place?
First the Gods and Heroes fiasco and now this.
aww man too funny. the crap never ends with PE, first G&H, then the craptacular fiasco that has gone on with STO and now this rears up. lol better than a soap opera, deception, intrigue, backstabbing, half-truths stay tuned for more, now a word from our sponsors......lmfao
Ah, 2007... the year the MMO industry managed to hit an all time low. Now I'm just waiting for the announcement stating that the STO license has been sold to... SOE


At this point, even SOE would be a vast improvement over PE.
Ouch, talk about being noobs in regards to business and contractual acumen.
If this lawsuit pans out, Paramount the one granting the license to PE should revoke it fully. Paramount doesn't want all this drama surrounding their "Star Trek Online" IP. Much less after a questionable game software developer that has now been outed by a contractual lawsuit that does have merit.
Like "Ten Ton Hammer" stated at the end of their article the fans of STO will get the short end of the stick. But from a suit point of view Paramount will want to distance themselves from PE if this continues from bad to worse.
Another morsel to chew on if this was indeed a fraudulent exchange of assets from PE to it's next corporate incarnation. Than a criminal inquiry of the State Attorney General's Office will be considered down the road.
QFT
However, with the issues that now surround the license, SOE wouldn't touch it with a 39 1/2 foot pole. I hope the devs weren't counting on a Xmas bonus this year!
You know, this might become a class action lawsuit as I doubt Kohnke is their only creditor that got shafted.
Yeah! Now let's give this license to an experienced developer with some great games under its belt, like uh... Bethesda!!! Uh.... SOE!.... Uh.... EA? Er... help me out? Who could pick it up exactly who isnt already snowed under making one of their own? :s bah, STO is dead.
if anything this will end up with PE losing STO which will be a good thing so now we can have some one good make a fun game, that isn't a wow clone. if we're lucky of course.
Hey, Valve would make for an interesting MMO developer, despite the previous FPS focus. Just brainstorming here.
Your right. What a turn of events. Makes you wonder if Perpetual was even serious about Gods and Heroes at one time.
As I said before, you can't shift assets from one company to the next when you owe money and expect the creditors to not notice.
You can kiss STO goodbye. I just hope noone is dumb enough to offer Mr Stinnet a job when Pepetual goes under, his resume should read failure to understand anything about this industry.
I hope CME take this over.. they got their act together - i going to say one MMO for the SCI-Fi, that allows us sci fan to have what we want. a true sci-fi MMO - SGW (STARGATE WORLD) just move up to the top of list for me.
Derek Smart perhaps?


Don't think it will happen anyttime soon. The litagation will hold the IP in Limbo for the next 5-10 years possibly longer depending on how well a job PE does fighting the case (or has done murkying the waters) Very unlikely this will be resolved in 3 years or less IMO. So if PE does die with this. then kiss the IP goodbye for a good long time. (even once legalities are settled "once bitten twice shy", it would be unlikely anyone would jump on it)
Will just point out there is a legal battle set to go on. it will not be resovled in a day, a week, or even a year. STO is going to sleep for a long time. Hopefully someday it will make it back to seeing the light of day. Though i wouldn't hold my breath on it being anytime soon.
ie. Its dead Jim
Granted, I was one of the first few individuals to convince MMORPG to advertise STO when it was first announced, I kind of want to gnaw my arm off now for suggesting it. All this does is recertify my opinion that experienced gaming companies are much more ideal for these monolith sized titles. SOE, Blizzard and EA Mythic are some of which I would trust for such a task.
Give me a T !
Give me a U !
Give me a R !
Give me a B !
Give me an I !
Give me a N !
Give me an E!
Ra ra ra !
Anyway regardless of what happens, even if PE/P2 hangs on to STO through some bizarre act of God, I think we all know (or should) that STO won't be out for a long time.
10 years at least. The IP license is now locked up in a lawsuit, which makes it pretty much poison for anyone else wanting to look at it, until all legal issues are resolved.
The only hope is that given the relatively small $$$ numbers involved, Paramount themselves may step in, pay everybody off to go away, and reclaim the property cleanly themselves.
It is amazing how these people got any money to start making G&H in the first place. Let alone somehow win the STO license...
Hey, they're making SOE look good even to some of the haters, and that takes some serious effort.
I hope paramount pulls out of their deal with PE/P2, I suspect they'd have the legal code for doing so for 'underperforming' or some other vague legal term. Would have been a smart thing to do.
If they could pull out the license and sell it to someone else quickly, we might see a STO game in 5 years (not joking, it takes about that long now, unless you're making a YAAMMO (Yet another asian mmo) where cut and paste and bad hairdo's rule.
Since SOE was handling the marketing and publishing, some of the stink has rubbed off on them as well. Considering they are still promoting a dead game 2 months after it was cancelled, I would say SOE is looking pretty stupid.
I have to say, that is fricken' hilarious.
"Promoting" means spending cash. Not changing a website for a while isn't promoting.
If anyting, SOE lost money to them too, I doubt that PE paid them anything for the little bit of promoting they DID do.
Well that is because Gods and Heroes is on "indefinite hold," and will be released sometime in the near future. Well maybe future... or far future.... well, maybe never, but that's not the point.
Hey look! There's a Stealth Fighter flying overhead...
pro·mote

/pr??mo?t/ Pronunciation Key - Show Spelled Pronunciation[pruh-moht] Pronunciation Key - Show IPA Pronunciation
Number six
nuf said....
To make the mixture even better, startrek.com is being closed down and all the staff related to the website is being dismissed, permanently.
More info at the source of the information
http://slashdot.org/articles/07/12/16/229238.shtml
Another "great franchise" busted with bad planning and suckind developers (swg, matrix online...)
Still sucks, though.
All I can say is I hope to god SOE don't pick it up.. And I was soooo looking forward to playing a Klingon SO.. ahh well
Don't get me wrong I still continue to play and support SWG and I'm a pre-CU Elder but, SONY have a real tendency to destroy things. I think the reason we all believe we will never see this game go live is its something we wanted..
Its not exactly the same but we've been waiting how long for Fallout 3 or a Fallout MMO .. just goes to show the point.. STO will likely not be taken up within the next 3 years, most other companies have their own projects going at the moment. I'd say if it is taken up the earliest we'll see it is 2011.
Not being American I have no idea how your judicial system works in these cases, but I hope PE are made to pay for Kohnke's expences. I love people that do MMO's but I don't think any company should be above the law and justice.. Or maybe Kohnke can send their own justice... ie Bob.. and his sledgehammer. ;)
Anyways my 2 creds worth.
Those mentioning that this will take 3 to 5 years before it reaches litigation in the courts regarding the civil suit against PE. Most likely like the bulk of these lawsuits they get settled out of court in some sort of plea bargaining.
In some indirectly related news from CBS which Paramount is involved. I'm hearing that the website of "StarTrek.com" will be pulled shortly. They're saying the site has been online for 13 yrs and was a major community hub.
Linky to the story posted 12/17 at Razorwire over at Warcry:
http://razorwire.warcry.com/news/view/79977-CBS-shuts-down-Startrek-com-after-13-years