Gencon Sued by LucasFilm (over Star Wars Celebration Make-a-Wish auction)

[mikejywood]

Poor Gencon

Wow, I can't believe this. I loved GenCon.

Things like this make Penny-Arcades's PAX convention and child play (the conventions charitable wing) all the better for the new game con of the future.

 

[Steel_Wind]

Gencon's website has been down all day, btw.

Not a happy portent, to be sure, though I do not expect that it signifies much right now.

 

[jdrakeh]

Damn. For the first time in more than a decade, I finally have the time and the money to attend GenCon. Ah, well, the 1st annual T&T con this year is looking more promising with every passing day

 

[Varianor Abroad]

Sounds like GenCon was having cash flow problems and used the auction money (peter) to pay paul. And they got caught.

Actually, it sounds like we have zero hard information and a lot of allegations in a Complaint.

I deal with lawsuits daily. With little businesses accused of nothing more than existing (so someone can go after a deep pocket) to people who screw up and try to cover it up.

Frankly, I think the lawsuit filing is mainly a result of lawyers wanting to a) up the ante, b) get a look at GenCon's books under court order and c) factors that aren't talked about in the Ether (Internet).

Let's talk about b) for a moment. There's a legal process called Discovery in civil lawsuits that lets you file certain requests for information. Frankly, I pay a lot of lawyers to do this all the time because there's a lot of people that fall and want money for it. I don't believe a lot of them when they say that they're hurt. So we file a suit (or allow a plaintiff to file a suit) in order to get a look at some hard information. Stuff that the other side doesn't give up voluntarily.

That said, Gen Con appears to have missed a communication opportunity, or there are some aggressive lawyers working for Lucasfilm. I suspect this will all be clear in about 3-5 years.

 

[Remathilis]

Pardon my ignorance, but is this going to screw up D&D XP?

What about Gen Con '08 and the 4e roll out?

 

[Steel_Wind]

I suspect this will all be clear in about 3-5 years.

I doubt that. A Chapter 11 filing automatically stays all actions unless an order allowing the action to proceed is obtained. That means Lucasfilm's action is dead in the water until the Bankruptcy Judge orders otherwise. So while there are reports from the Trustee and creditors in the estate can obtain information, the sort of discovery in the Lucasfim action you envision will not occur absent an order to the contrary. (There will be an accounting though.)

In a case like this, given the relatively modest amounts in issue, I doubt that anyone at Lucasfilm will seek such an order in the Bankruptcy.

But sometimes, when the fight is about something other than money, the matter goes differently. For example, if the Make-A-Wish allegations are true, and George Lucas is genuinely pissed off and decides to take it personally, he can raise hell in the bankruptcy proceedings and the debtor can end up far worse off than they ever thought they would be. That assumes the creditor is out to punish the debtor and teach it a lesson - never mind the ongoing financial costs to doing so. George Lucas certainly has the financial wherewithal to pursue that strategy should he choose to do so.

Bankruptcy can be a very ugly process when there is a creditor of the estate that wants to make it difficult for the debtor and is prepared to pay the money to the Trustee and to its lawyers to make it so. In the vast majority of cases, the creditors do not pursue these avenues of relief as it makes no financial sense to do so. That is not the same thing as saying it can't happen, however.

I've seen many defendants make an assignment in bankruptcy thinking that the pain is all over. Then they find out the creditors are not of the same view - at all. It's rare though.

 

[Mort]

I doubt that. A Chapter 11 filing automatically stays all actions unless an order allowing the action to proceed is obtained. That means Lucasfilm's action is dead in the water until the Bankruptcy Judge orders otherwise. So while there are reports from the Trustee and creditors in the estate can obtain information, the sort of discovery in the Lucasfim action you envision will not occur absent an order to the contrary. (There will be an accounting though.)

In a case like this, given the relatively modest amounts in issue, I doubt that anyone at Lucasfilm will seek such an order in the Bankruptcy.

But sometimes, when the fight is about something other than money, the matter goes differently. For example, if the Make-A-Wish allegations are true, and George Lucas is genuinely pissed off and decides to take it personally, he can raise hell in the bankruptcy proceedings and the debtor can end up far worse off than they ever thought they would be. That assumes the creditor is out to punish the debtor and teach it a lesson - never mind the ongoing financial costs to doing so. George Lucas certainly has the financial wherewithal to pursue that strategy should he choose to do so.

Bankruptcy can be a very ugly process when there is a creditor of the estate that wants to make it difficult for the debtor and is prepared to pay the money to the Trustee and to its lawyers to make it so. In the vast majority of cases, the creditors do not pursue these avenues of relief as it makes no financial sense to do so. That is not the same thing as saying it can't happen, however.

I've seen many defendants make an assignment in bankruptcy thinking that the pain is all over. Then they find out the creditors are not of the same view - at all. It's rare though.

Per the BK schedules Gen Con owes Lucas Film and Make a Wish Foundation about $432,661 between the two - depending on how strongly lucasfilm feels, this may be enough for their attorneys to file an adversary objecting to discharge. If nothing else they will do so to initiate discovery in the BK proceeding so that they can take a good look at the books. It will be interesting to see how this plays out.

 

[Maggan]

Pardon my ignorance, but is this going to screw up D&D XP?

What about Gen Con '08 and the 4e roll out?

Not necessarily as far as I know. I think D&D XP is a WotC event, GenCon is a ... well, GenCon event.

On another note, it's interesting to see that the little guy (GenCon) is taking a public beating instead of the goliath (LucasFilm). It's usually the other way around (c.f. The Evil Hasbro, Business People and Lawyers Are Bad™ and similar themes).

/M

 

[Nifft]

On another note, it's interesting to see that the little guy (GenCon) is taking a public beating instead of the goliath (LucasFilm). It's usually the other way around (c.f. The Evil Hasbro, Business People and Lawyers Are Bad™ and similar themes).

Sick children = PR win.

You can't compete with pathos of that magnitude.

Cheers, -- N

 

[Varianor Abroad]

I doubt that. A Chapter 11 filing automatically stays all actions unless an order allowing the action to proceed is obtained. That means Lucasfilm's action is dead in the water until the Bankruptcy Judge orders otherwise. So while there are reports from the Trustee and creditors in the estate can obtain information, the sort of discovery in the Lucasfim action you envision will not occur absent an order to the contrary. (There will be an accounting though.)

A fair point and something that I had forgotten. However, I have seen stays lifted for the limited purpose of discovery by judges, and informal discovery can of course go forward if both parties agree. I think my point is still valid absent the Chapter 11 filing. You are correct that this will stop everything for the underlying suit though, and is probably a factor in the decision to go Chapter 11. (That and the fact that the bankruptcy court may set schedules of payment, modify the amount owed, etc.)