11 replies to this topic

[DracIsBack]

Not long after Atari and Epyx worked together on the Lynx, Atari and Epyx went to court against each other. Anyone know what triggered the suit and what the outcome was? I seem to recall that Atari was the suit initiator. Was it tied to the number of promised games?

[Pilsner73]

DracIsBack, on Sat Apr 23, 2011 10:38 AM, said:

Not long after Atari and Epyx worked together on the Lynx, Atari and Epyx went to court against each other. Anyone know what triggered the suit and what the outcome was? I seem to recall that Atari was the suit initiator. Was it tied to the number of promised games?

From what I remember. Epyx needed more money so Atari said "Ok we will fund you this amount but we expect you to meet all contractual obligations on time or we get it all". Epyx was late and Atari moved forward on taking them over.

Edited by Pilsner73, Mon Apr 25, 2011 2:10 PM.

[DracIsBack]

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

. Epyx was late and Atari moved forward on taking them over.

The company or the rights to the Lynx? I thought it was the latter ...

[kool kitty89]

DracIsBack, on Mon Apr 25, 2011 5:57 PM, said:

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

. Epyx was late and Atari moved forward on taking them over.

The company or the rights to the Lynx? I thought it was the latter ...

I thought Atari did end up getting full ownership of the lynx. (or, if not full IP rights, at least free use of the chipset without royalties)

[Pilsner73]

DracIsBack, on Mon Apr 25, 2011 5:57 PM, said:

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

. Epyx was late and Atari moved forward on taking them over.

The company or the rights to the Lynx? I thought it was the latter ...

For some reason I keep thinking it was the whole company because shortly after the Lynx was released, epyx ceased to exist.

[doctorclu]

Pilsner73, on Tue Apr 26, 2011 7:23 AM, said:

For some reason I keep thinking it was the whole company because shortly after the Lynx was released, epyx ceased to exist.

Atari was a ruthless business partner and ruthless as company. While I miss Atari, realizing how ruthless they were makes me feel a bit easier that Sega and Nintendo (and Sony) stomped Atari in the mud eventually.

[Tempest]

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

From what I remember. Epyx needed more money so Atari said "Ok we will fund you this amount but we expect you to meet all contractual obligations on time or we get it all". Epyx was late and Atari moved forward on taking them over.

Sounds almost exactly like what they tried to do with Amiga before Commodore bailed them out.

Tempest

[Retro Rogue]

Tempest, on Tue Apr 26, 2011 9:34 AM, said:

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

From what I remember. Epyx needed more money so Atari said "Ok we will fund you this amount but we expect you to meet all contractual obligations on time or we get it all". Epyx was late and Atari moved forward on taking them over.

Sounds almost exactly like what they tried to do with Amiga before Commodore bailed them out.

Tempest

Sounds almost not like what happened, there was never any such clause with Amiga.

[Tempest]

wgungfu, on Tue Apr 26, 2011 11:53 AM, said:

Tempest, on Tue Apr 26, 2011 9:34 AM, said:

Pilsner73, on Mon Apr 25, 2011 1:34 PM, said:

From what I remember. Epyx needed more money so Atari said "Ok we will fund you this amount but we expect you to meet all contractual obligations on time or we get it all". Epyx was late and Atari moved forward on taking them over.

Sounds almost exactly like what they tried to do with Amiga before Commodore bailed them out.

Tempest

Sounds almost not like what happened, there was never any such clause with Amiga.

I thought I read that Atari loaned Amiga the money to continue to develop the Amiga, but if they couldn't repay the loan back in X days then Atari got everything and when Commodore bought them they repaid the money to Atari.

EDIT: Ok here's the blurb I read:

Quote

Atari was also present during the show and was impressed by Lorraine. Instead of offering to invest in the company outright, Atari offered a $500,000 loan in exchange for the Lorraine's motherboard design. The loan would have to be paid back in one month, and if Amiga was unable to repay the loan, the entire Lorraine project would be forfeited to Atari.

http://lowendmac.com...-commodore.html


There are other mentions of this deal on other sites (including those that specialize in Amiga). If this is a false story it sure got spread around.

Tempest

[Pilsner73]

Atari could be ruthless but Epyx signed the contract knowing the reputation Atari had.

Edited by Pilsner73, Tue Apr 26, 2011 7:57 PM.

[Retro Rogue]

Tempest, on Tue Apr 26, 2011 11:56 AM, said:

I thought I read that Atari loaned Amiga the money to continue to develop the Amiga, but if they couldn't repay the loan back in X days then Atari got everything and when Commodore bought them they repaid the money to Atari.

EDIT: Ok here's the blurb I read:

Quote

Atari was also present during the show and was impressed by Lorraine. Instead of offering to invest in the company outright, Atari offered a $500,000 loan in exchange for the Lorraine's motherboard design. The loan would have to be paid back in one month, and if Amiga was unable to repay the loan, the entire Lorraine project would be forfeited to Atari.

http://lowendmac.com...-commodore.html


There are other mentions of this deal on other sites (including those that specialize in Amiga). If this is a false story it sure got spread around.

Tempest

Apparently you missed the thread where Curt and I discussed all that (was the thread where we released the details of some of the other advanced computers and technology we uncovered through interviews in 2009-2010).

It's a false story chiefly spread by RJ Mical, who was not actually involved in the dealings or signing. We wound up paying for the actual Federal court documents and got copies of the original agreement besides interview people on the Mickey team and some ex-Amiga compatriots.

Atari Inc. gave the money in March of 1984 (we have a copy of the cancelled check actually) as an initial payment to to guarantee a later signing of a license agreement that was to talk place in late June/early July. The money showed their sincerity, gave Amiga badly needed money, and gave Atari access to Amiga's chip tech for use in the Mickey project - along with access to some of Amiga's people for advising on the project. There was never any "pay back or else we get the company" terms. Dave Morse was clear from the beginning he ultimate goal was to sell Amiga after it was built up, and didn't want anything to interfere with that. In fact, there were already 4 or so other companies invested in Amiga when Atari came on board. The only thing there was, was a licensing clause. Since Amiga already had the other investors, and were constantly teetering on bankruptcy, Atari needed some way to guarantee that it wouldn't be a complete loss if Amiga went bankrupt because the properties would of course be divvied up with the other investors looking to recover their investments. So, they made a clause - copies of the chip specs (layouts, documentation, etc.) were placed in escrow and to be released on the licensing signing that June/July. If Amiga went bankrupt before then and Atari could not recover their money, then the materials in escrow would be forfeited to Atari for their use royalty free.

The licensing agreement was to be signed upon the delivery of the first chip samples that June/July, where Atari would pay specific amounts for each of those individual chips. Then there would be royalties paid on every chip manufactured and used, plus a huge stock purchase (which was not on a continually sliding scale as RJ claimed). Likewise, there was a clause that it was only for use in coin and as a console through 1985, since Amiga wanted time for their own computer on the market. In 1985 they'd be allowed to release a keyboard expansion for the unit that turned the console in to a computer, and in 1986 Atari Inc. would be allowed to market an actual full computer.

According to the testimony, both groups met again at the June CES and were excited and looking forward to the pending signing. Just after the show, Commodore approached Amiga about investing and then outright buying. Dave Morse started getting gunshy that somehow the Atari deal would screw this up, and began looking for a way out. Nobody at Atari knew anything was up and in fact the Mickey team was waiting for the chips to be delivered so they could plug them in to the Mickey PCB's which they were expecting delivery of from the fabrication plant. They went on a long July 4th weekend and were expecting everything to be there when they got back. That Thursday, Morse shows up with a check and interest at his counterpart's office at Atari, giving a story that he wanted to pay the money back because they couldn't get the chips to work. The counterpart said he wasn't even sure he was authorized to take a check, they didn't want the money back and it was no problem if they needed more time (again all in testimony). Dave didn't want it, and they left it in the air until after the July 4th weekend. That Friday, Warner began negotiations with Jack unknown to anyone at Atari, to sell consumer, which was done by the time everyone came back. The check and the contract slipped through the cracks (the contract had actually, like the GCC one, been owned by Warner) until the end of July when Leonard Tramiel discovered it during the asset evaluation period. Commodore had already announced it's pending purchase of Amiga, and slapped an injunction on Shiraz and two other engineers that early July so they couldn't do computer work for Jack. Jack saw this as an opportunity to counter, contacted Warner about getting the contract, had it signed over in early September and then launched the counter-suit in Mid-September.

Commodore/Amiga eventually settled out of court, which included paying Atari Corp.'s court costs.

So the only one's being ruthless actually were Amiga. Dave outright lied to Commodore (telling them he was worried about a takeover and needing money up front which he then used to pay back the money with interest), and he outright lied to Atari by saying the chips didn't work. He also lied under oath when he stated the Lorraine prototype didn't exist any more and was broken up and used in other projects, which is why he couldn't produce it in court (as if to further show it just didn't work). As everyone knows, Dale Luck has shown off Lorraine at VCF-East.

Edited by wgungfu, Tue Apr 26, 2011 9:01 PM.

[DracIsBack]

wgungfu, on Tue Apr 26, 2011 8:58 PM, said:

It's a false story chiefly spread by RJ Mical, who was not actually involved in the dealings or signing. We wound up paying for the actual Federal court documents and got copies of the original agreement besides interview people on the Mickey team and some ex-Amiga compatriots.

Cool answer on the AMIGA story and all, but how about answering the original question ...?

Quote

While I miss Atari, realizing how ruthless they were makes me feel a bit easier that Sega and Nintendo (and Sony) stomped Atari in the mud eventually.

They were ruthless, but ask Nintendo's third parties how ruthless they were during the NES days.

Edited by DracIsBack, Wed Apr 27, 2011 4:23 AM.