The Sinking City Delisted from Steam After Long Fought Legal Battle With Licensee

The studio finally was able to terminate the contract this year.

Developer Frogwares has released a statement on its website about its lovecraftian mystery game The Sinking City being delisted from Steam, and it sounds like it’s the result of an a legal battle surrounding the game with licensee Nacon (previously Bigben Interactive).

The extensive recap of the situation explains that Nacon has not been keeping up with much of its end of the deal as The Sinking City’s distributor. The deal was that Frogwares would receive a financial contribution to help development along, while Nacon would be given the right to sell and promote the game on four platforms, specifically Xbox One, PlayStation 4, Steam, and the Epic Games Store. In this set up, Frogwares would maintain IP rights for The Sinking City.

According to the post, Nacon was consistently late with payments to the studio, being around 40 days late each time on average, while Frogwares was always on time with each milestone that was approved by the licensee. Eventually Frogwares had to issue formal statements to Nacon to receive the payments owed. Things got weirder when Nacon bought out another studio that was working on a different Lovecraftian game, and then asked for The Sinking City’s source code. As a licensee, not a publisher, co-creator, or anything that even remotely approaches IP ownership, Nacon had no claim to the source code, so Frogwares says it refused. This was followed by four months of silence on the financial contributions the studio was owed.

When The Sinking City finally launched on June 27 of last year, Frogwares received a letter from Nacon saying that previously approved milestones were being cancelled, which meant the studio wouldn’t be receiving any profits from the game’s sales. Which obviously meant it was time for Frogwares to square up for court. A lawsuit was filed in August, which, funnily enough, prompted Nacon to send actual financial reports to Frogwares that had been long kept from the studio. However, the post describes them as “incomplete and undocumented.” Among these financial reports it was said that a console manufacturer (it isn’t specified whether this was Microsoft or Sony) hadn’t paid royalties on the project for over five months, while the write-up says that this company has always been on time with these payments with the studio’s other games.

As time went on, more of Nacon’s attempts to obscure who actually owned the IP surfaced through boxed copies of The Sinking City putting Frogwares’ name on the backside alongside technical partners, while Bigben Interactive’s logo was put on the front cover. A tabletop game based on The Sinking City was also developed without Frogwares’ knowledge, with a false copyright claiming the IP was owned by Bigben Interactive.

After 11 months of attempting to resolve the issue, Frogwares ultimately ended up terminating the contract on April 20. However, Nacon wrote in an email correspondence that the contract cannot be terminated due to emergency laws in France, where the licensee is based. Specifically, it cited the ongoing struggles brought about by the coronavirus pandemic, and that the laws were meant to help keep businesses afloat during times of crisis. However, that explanation triggers a Force Majeure (legal jargon meaning that contracts can be terminated if for some reason both parties are unable to fulfill their obligations due to whatever circumstances) article of the contract, and that because of Nacon’s explanation that it can’t fulfill its obligations due to the pandemic, Frogwares was able to terminate the contract on those grounds.

As such, Frogwares has requested storefronts like Steam delist The Sinking City to both prevent any of those sales profits going to Nacon, as well as give them time to sort out things before bringing the game back to digital storefronts. The studio did, however, offer PC players some alternatives, including buying a DRM-free copy from the Frogwares website.

So that’s why you can’t get The Sinking City on Steam right now. Between this and the Aeon Must Die developers coming forward about poor working conditions enabled by its publisher, a lot of devs are starting to speak out about deals that have gone sour and the business realities that have long gone on behind the scenes.

For more on The Sinking City, check out Fanbyte’s review.