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Wednesday, July 27th, 2005
Time
Event
9:59a
The ESA issued a press release today lauding the U.S. District Court for the District of Maryland for giving jail time to a College Park resident for his role in an Xbox piracy scheme.
Hitesh Patel, 31, who plead guilty on May 18th was sentenced by Judge Peter J. Messitte to serve four months in jail followed by four months of home detention, followed by two years of supervised release. Patel, Biren Amin, Mrugesh Amin, and Herbie Walker all worked in Pandora's Cube, a small video game chain with stores in Springfield, Virginia; College Park, Maryland; and Baltimore, Maryland. Biren Amin owned the stores. Patel managed the Springfield store and provided technical skills. Mrugesh Amin and Herbie Walker were managers in the Maryland locations. All defendants in the case have plead guilty.
"We are grateful for the work of U.S. law enforcement and prosecutors for bringing this defendant to justice," said ESA President Doug Lowenstein. "Sentences of this magnitude send a strong message to the pirate community that intellectual property theft is a serious crime with serious consequences."
During 2003 and 2004, Pandora's Cube assembled and sold modified Xboxes, which the company marketed as "Super Xboxes." The Super Xbox was customized by Pandora's Cube to defeat the Xbox's integrated copyright protection system. Sold with a mod chip, software and a larger hard drive, the Super Xbox allowed users to copy games from a retail disc onto the hard drive. Games could then be played from the hard drive without inserting the retail disc. Pandora's Box also pre-loaded a large number of Xbox games onto the Super Xbox hard drive.
"The commercial manufacture and sale of circumvention devices like the Super Xbox serves only one purpose: facilitation of large-scale piracy," said Acting Assistant Attorney General John C. Richter of the Criminal Division. "Such piracy and the resulting illegal windfall for these few comes at the expense of the many Americans who labor to keep our nation at the forefront of technological advance."
The maximum penalties for a first time offender convicted of conspiracy to violate the Digital Millennium Copyright Act and to commit felony copyright infringement are five years in prison, a fine of $250,000, and restitution to the victims. Biren Amin is scheduled to be sentenced on August 17, 2005. Mrugesh Amin is scheduled to be sentenced on August 9, 2005. Herbie Walker is scheduled to be sentenced on August 4, 2005.
According to the Department of Justice, the case was investigated by U.S. Immigration and Customs Enforcement. The ESA is credited with providing assistance.2:56p
The Associated Press is reporting that a 85-year old woman has filed a federal lawsuit against Take-Two and Rockstar over the GTA San Andreas Hot Coffee scandal. The action was filed in the Southern District of New York earlier today and seeks to establish class-action status for purchasers of the game. The plaintiff, Florence Cohen, states that bought GTA:SA for her teenage grandson late in 2004 when it was rated "M". Now that Hot Coffee has been revealed, Ms. Cohen is claiming unfair business practices, consumer deception and false advertising.
The AP reports that Take-Two had no comment.
EDITOR'S NOTE: Class-action lawsuits often translate to a little bit of money for individual plaintiffs (what's the loss here, $49.99?), but big bucks for the attorneys representing the entire class of plaintiffs. In San Andreas' case the potential pool of plaintiffs could number in the millions.
UPDATE: One of our GP faithful has weighed in with the news that the attorney is Laurence D. Paskowitz. That been confirmed and Paskowitz has an apparently thriving class-action practice.
LATEST UPDATE: The New York Daily News is reporting a couple of new bits of information. The plaintiff, Ms. Cohen, is from the Bronx. And what she wants is a refund of her fifty bucks.8:21p
Dominoes, anyone? And we don't mean pizza. With each day bringing a new piece of bad news, it seems like there is a domino effect at play in the Hot Coffee scandal surrounding Take-Two and Rockstar Games. Consider this week, and it's only Wednesday:
-Monday: the House of Representatives votes overwhelmingly to request that the FTC investigate the scandal
-Tuesday: the FTC announces it has already begun investigating
-Tuesday: Senator Sam Brownback (R-KS) jumps in with his own call for FTC action
-Wednesday: a class-action lawsuit is filed on behalf of a grannie who bought San Andreas for her grandson
What happens tomorrow? Who knows, but we're sure it will be something juicy. So does this ripple effect spell ultimate doom for Take-Two? Are they in the throes of an Enron-like death spiral?
Hardly.
GP traded e-mails on the topic with well-known video game industry analyst Michael Pachter of Wedbush-Morgan earlier today. The conversation went something like this:
GP: Michael, was something like Hot Coffee inevitable, what with content continually pushing the acceptability envelope?
Pachter: The patch isn't news, the content isn't that outrageous. What was inevitable was Congressional grandstanding. No comment from them about violence in games, but pixelated sex? Outrageous.
GP: If something like this was going to happen, is it surprising that it was Rockstar?
Pachter: Not surprising that Rockstar tried it, but it was an inappropriate risk given the value of the franchise.
GP: We're seeing a domino effect now - FTC investigation yesterday, class-action lawsuit filed today. Something new & negative almost every day. Is Take-Two in mortal danger?
Pachter: Only venial danger for Take-Two. The appropriate remedy IF THE FTC FINDS DECEPTION is to replace the "defective" games with appropriately labeled M rated games. That costs $2 - 10 per copy (depending on whether Sony waives the royalty). How many copies do YOU think will be turned in? First, I don't think the FTC finds anything. Second, in the EXTREMELY unlikely event that it does, fewer than 100,000 suckers will return the cool version for the sanitized version. No harm, no foul. The class action lawsuit is a joke. Grandma bought little teenage Johnny a game with cop killing, and is only upset now because of simulated sex? Damage is negligible.
GP: Will the Fall release of Bully be more problematic for Take-Two and Rockstar, coming as it does on the heels of Hot Coffee?
Pachter: Bully will be a stupid game, and will rock in England. Doubt it sells well in the U.S.
GP: Take-Two's stock price (TTWO) has dropped about 2 points but seems to be holding steady. Is that a good sign?
Pachter: Investors shouldn't have punished the company for this. It reflects poor management oversight, nothing more. I don't think it will happen again, so it's a waste of time to fret about its impact on the company's value.
GP: Should somebody at the executive level be fired over this? Will they?
Pachter: Nobody should or will be fired, because the "inappropriate" content was created as a trial, rejected by management, and locked under long-standing industry practice. The fact that it wasn't discovered until 8 1/2 months after the game was released is consistent with my belief that it wasn't intended to be discovered. If there was no intent to expose people to sex, then I can't see firing anyone.
GP: Did you catch Take-Two's statement when the ESRB ruling came down? Here is what they said:
"We are deeply concerned that the publicity surrounding these unauthorized modifications has caused the game to be misrepresented to the public and has detracted from the creative merits of this award winning product," said Mr. Eibeler. Take-Two is exploring its legal options as it relates to companies that profited from creating and distributing tools for altering the content of Grand Theft Auto: San Andreas. "
They haven't responded to a request to clarify what exactly they mean by that. The modders? Not much money there, one would guess. Datel, who makes Action Replay? But hasn't the legality of cheat devices long ago been affirmed? Or possibly download sites that hosted Hot Coffee? I know some commercial site like File Planet had it...
Pachter: Don't know. It's a free country, everyone should explore their legal options.
GP: Thanks, Michael! Good stuff...11:18p
There has been great deal of discussion - sometimes heated - on GamePolitics in recent weeks as to whether Hot Coffee is a hack or a mod.
The distinction is a fine one. Those on the hack side seem primarily disposed to defend Rockstar and condemn Dutch modder Patrick Wildenborg for violating the San Andreas EULA. Those who come down on the mod side are more sympathetic to PatrickW for simply doing what modders do.
Seeking clarification, GP turned to the GTA mod community, specifically, illspirit, of gtagarage. It was just two days ago that illspirit issued a highly critical open letter to the ESRB. Now he's back to give us his insider's view. So, ill, is Hot Coffee a mod or a hack?
"In this case, there is really not much difference, and it all depends on what exactly the person is implying. Long ago before the media and pop culture got a hold of the word, hacking simply meant to modify computer software or hardware to do something fun, interesting. or unexpected. Users might hack their old luggable word processor machine to play chess with it, or gamers would hack the original Doom to make the shotgun have rapid-fire."
"These days, the term hacking has stigmas attached to it such as breaching network security, or making hacks that exploit holes or break/avoid sections in existing game code for cheating online. On the other hand, modding is generally thought of as adding entirely new features or assets to a game, or
rearranging the existing assets in a totally new way."
"In the case of Hot Coffee, one might technically consider it a hack since the standard version of it doesn't add anything new or drastically change what was there already. The version with nudity though, is by all means a mod, as we manually edited the files to swap in the skins, thus alter the scenes in a manner which did not exist otherwise. But even in the version which simply unlocked the code, it's not as if we were hacking bits of the execute where we shouldn't be while looking to exploit that specific section
of code."
"We've been editing the mission script files for the series since the first game in 1997 in order to design our own missions, story lines, and features for mods. The Hot Coffee scenes were discovered on accident during the course of exploring the files so that we could learn about the new script commands, and update our homemade mod tools accordingly. After we were up to speed on some of these changes, the same tools and methods one would use for any other script mod were used to tweak the existing script to see what the blocks of mystery code did. So in that regard, it's still a mod as standard modding techniques were used to edit it."
"At any rate, just because something doesn't add a bunch of new models/skins/whatever to game doesn't mean it's not a mod. If one were to go into, say, the Half-Life mod community, and accuse people of being a lowly dirty hacker for prodding the original game to make any of the coop mods, one would get laughed off the intraweb by both the community and the developers. So, yea, the difference between the two terms isn't always clear cut. I hope this helps."
Thanks for checking in, illspirit. You've given us some great insights into the GTA mod scene and how Hot Coffee came about.
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