Royalty row after Spilt Milk fails to pay dev

Andrew Smith, the managing director of Spilt Milk Studios, has not paid royalties to a development partner for three months after a bitter and now public dispute.

Smith (pictured, right) had no legal obligation to pay the funds.

On Tuesday he told Develop he nevertheless put money in the account of former partner Nicoll Hunt (pictured, left) as a gesture of goodwill.

Yet Develop has seen bank documents which indicate Smith had not paid Hunt since November 10th for royalties from App Store sales of the iOS game Hard Lines.

The matter is complicated further for several reasons, including that Hunt was paid a small sum on January 16th for what is claimed, though not proven, to be royalties from the Android version of the game.

Smith told Develop today that, despite his disappointment that the row has entered the public domain, he is currently in the process of paying Hunt royalties.

“It seems that my goodwill gesture has backfired on me,” he said.

The payment row follows a hostile split between the two developers who had collaborated on Hard Lines for about ten months.

Hunt claims he owns the game’s code as well as its assets. Smith told Develop that the issue of ownership of the IP was a matter of dispute.

But Smith’s alleged missed payments could now be crucial in the matter.

Both parties signed a contract in May last year, of which a clause stipulated that rights were split evenly between both parties providing that the “Consultancy” [Hunt] was paid his fees.

If Hunt has proof he had not been paid required fees then it could mean Smith must relinquish any remaining ownership of Hard Lines.

However, Smith says the contract allowed him to terminate the agreement, in which case he was not obligated to pay Hunt.

Meanwhile, a Sheridan’s lawyer representing Hunt believes that Smith has no legal right to create new versions of Hard Lines without Hunt’s consent. This too is a matter of dispute. Smith says the lawyer’s view is “clearly biased”.

Friends to foes

The clash between Smith and Hunt began in October last year, when Smith decided to build various editions of Hard Lines for platforms other than smartphones.

Hunt chose instead to work on other projects. However, under the terms of his contract, he was due 50 per cent of Hard Line’s profits.

Smith, who cannot code, by this stage decided it had become impractical to work with another contractor because he had only half of the total profits to negotiate with.

Soon after he attempted to negotiate a new royalty structure with Hunt – one that would provide a fee attractive enough to sign a new coder to expand the game to other platforms – yet his partner said he was not willing to negotiate away from his 50 per cent share.

Smith subsequently terminated the contract.

“I terminated the contract because he [Hunt] refused to budge on the negotiation,” Smith told Develop yesterday.

“Hunt wouldn’t budge on 50 per cent of revenues on everything ever done, which you can imagine just makes any opportunity… well, it means I would lose money [if we developed further versions].

“When Hunt didn’t budge I told him we had to come up with a structure that would work out fairly for both of us,” Smith said.

Hunt disputes this version of events.

And today he told Develop he would rather see Hard Lines no longer trading on the App Store.

“I’m really not fighting to get the rights to the game,” he said.

“I just want him [Smith] to stop using my assets and code without my permission and without paying,” he said.

Smith said he was disappointed that the highly complex matter had gone public, partly because the context of the debate would be lost in news articles.