Atari 2010 Annual Report Download - page 130

ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
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plaintiff's claim of authorship and/or co-authorship of the franchise and considers the grounds and the amount of the
claim to be unfounded.
The parties have filed their pleadings with the court but no significant progress was made in fiscal year 2009-2010. The
preliminary audience's court is scheduled for early September 2010.
Consequently no provision has been recorded in relation to this matter.
24.2. Stanley v. IESA, Atari Inc. and the members of the Atari Inc. Board of Directors
On April 18, 2008, an Atari, Inc. minority shareholder, filed a Verified Class Action Complaint against Atari Inc., certain of
its directors and former directors, and the Company with the Delaware Court of Chancery. The plaintiff alleges that the
Atari Inc. director defendants breached their fiduciary duties to Atari's minority shareholders by entering into an
agreement that allowed the Company to acquire the outstanding shares of Atari's common stock at an unfairly low price.
The plaintiff asked the court to enjoin the proposed merger transaction, or alternatively, to rescind it in the event that it
was consummated, and was seeking damages.
On April 29, 2009, the Delaware Court of Chancery approved the negotiated settlement concluded by the parties,
pursuant to which the Company agreed to pay USD 310,000 to the plaintiff. Atari Inc. bore the cost of the settlement
approved by the parties during fiscal 2009-2010.
24.3. Atari Europe SAS litigation
24.3.1. BVT production funds v. Atari Europe SAS
This dispute concerns two German entities, BVT productions funds, which, pursuant to a series of agreements entered
into with various Group companies, financed the production of certain interactive game titles.
Following exchanges of correspondence and an audit in December 2008, the BVT funds launched proceedings in March
2009 in Germany, claiming the breach by Atari Europe of several contractual obligations arising from publishing
agreements linking the funds to Atari Europe. The claims made by the funds before the German courts amount to €2
million.
Atari Europe filed its pleadings with the Munich Court, contesting each of the plaintiff’s allegations. A hearing had taken
place in November 2009. At this point in time, the parties are still waiting for a court ruling initially expected in December
2010.
24.4. Disputes to which Atari Inc. is party
24.4.1. Research in Motion Limited v. Atari Inc. and Atari Interactive Inc.
On October 26, 2006, Research in Motion Limited ("RIM") filed a claim against Atari Inc. and Atari Interactive Inc.
(together referred to as “Atari”) with the Ontario Superior Court of Justice. RIM is seeking a declaration that (i) the game
BrickBreaker, as well as the copyright, distribution, sale and communication to the public of copies of the game in
Canada and the United States, does not infringe any Atari copyright for Breakout or Super Breakout (together
"Breakout") in Canada or the United States, (ii) the audio-visual displays of Breakout do not constitute a work protected
by copyright under Canadian law, and (iii) Atari holds no right (notably intellectual property) in Breakout under US or
Canadian law. RIM also submitted a claim for legal costs.
In August 2007, the Court ruled against Atari's December 2006 motion to have the RIM claims dismissed on the ground
that the Canadian courts did not have jurisdiction.
On January 19, 2007, RIM added claims to its case requesting that it be established that (i) its game Meteor Crusher
does not infringe Atari copyright for its game Asteroids in Canada, (ii) the audio-visual displays of Asteroids do not
constitute a work protected under Canadian law, and (iii) Atari holds no right (notably intellectual property) in Asteroids
under Canadian law.
Plazmic Inc., a subsidiary of RIM, has joined the proceedings. Atari Inc. decided to file a counterclaim for breach of
copyright on Breakout, SuperBreakout, Asteroids and Asteroids Deluxe in Canada.
In December 2006, Atari Interactive Inc. initiated proceedings before the Federal Court for breach of copyright in
Canada. Insofar as the proceedings before the Ontario Superior Court of Justice are in progress, Atari Interactive has
accepted that the proceedings before the Federal Court be suspended pending the decision of the Ontario Superior
Court of Justice.
No further progress has been made in the proceedings. In August 2008, RIM offered to pay USD 250,000 by way of an
out-of-court settlement. In March 2010, the parties agreed to end their dispute by signing a negotiated settlement.