Card Designer Who Failed to Deliver Kickstarter Rewards Sued

The Washington State Attorney General has filed suit against a card game developer who failed to deliver on his Kickstarter rewards.

In September of 2012, Nashville-based Altius Management started a Kickstarter campaign to fund the development of a retro-horror themed playing card deck called Asylum Playing Cards. After raising $25,146, far more than their $15,000 goal, it seemed that the project would be another Kickstarter success story.

Unfortunately, that was not the case. Despite an expected delivery date of Dec. 2012, the promised rewards have still not been delivered. In response to this failure, the Washington State Attorney General’s office has filed a lawsuit against Altius and its president, Ed Nash, on behalf of 31 backers who lived in Washington at the time they backed the project.

The suit (you can read the complaint here) alleges that Altius and Nash breached the terms and conditions set forth by Kickstarter for project creators. According to those terms, creators are “legally bound to fulfill backer rewards if funding is successful.” It goes on to accuse Nash of engaging in practices “constituting unfair or deceptive acts in trade and commerce.”

Furthermore, the second cause of action in this suit mentions Altius’ failure to provide refunds to those customers who requested them. The suit seeks up to $2,000 in civil penalties for each violation, and also asks to have all legal fees and court costs covered by the defendant. It also asks that the court mandate restitution to consumers as part of its judgement.

Obviously, there is a long way to go in resolving this suit, but its outcome may have some far-reaching effects on Kickstarter and crowdfunding. If Altius is held financially liable for failing to deliver, other devs may shy away from crowdfunding for fear of gaining funding but being unable to fulfill either rewards or refunds. Kickstarter’s response to this case so far has been fairly boilerplate. A spokesperson for the crowdfunding site told Polygon,

“Tens of thousands of incredible projects have been brought to life through Kickstarter. We want every backer to have an amazing experience, and we’re frustrated when they don’t. We hope this process brings resolution and clarity to the backers of this project.”

Even if devs don’t develop doubts about crowdfunding, the backers may. A visit to the comments of the Altius Kickstarter page reveals backers talking about contacting the Washington Attorney General in hopes of forming a class action suit, as well as several calling for more aggressive action from Kickstarter itself. Here are a couple of selected comments:

“I’m hoping that this case becomes precedent for going after or getting KS involved. I understand the need to limit liability but I’ve lost hundreds of $$ on this site to frauds and liars and it’s time they step up to protect their costumers.”

“Twice I asked KS Admin to get involved, twice I got the mandatory shrug off “sorry, can’t do a thing” response. That is irresponsible. You don’t provide a service, cream off a cut, and then turn your back on what’s going on while you count the cash earned from that cut. I may not get my money back, as I’m a UK resident, but I wish the prosecution and the Washington crew all the best. If anything comes out of this, I hope there’s better governance and protection for future backers and creators too, from the people who run this site.”

The long and short of it is this: Kickstarter remains a crap shoot, and I wouldn’t blame you if you quit using it (like I did). After all, tracking website Kickscammed reports that over $1.5 million in reported Kickstarter scams have been reported so far. However, if this court case ends up going against Altius, it could change the whole dynamic of Kickstarter. If one attorney general is successful, it could spur more suits. More suits could result in FTC regulation of crowdfunding, which could be a very interesting development to the entire Kickstarter dynamic.

For now, we’ll keep an eye on this case, and we’ll keep you posted on any new information that comes our way.

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6 Comments on Card Designer Who Failed to Deliver Kickstarter Rewards Sued

Rickshaw

On May 5, 2014 at 8:18 pm

Stop paying to work!

Stop paying people you don’t know!

How many times do you pass a beggar in street? but, you never give them any money, Its just the same as the beggar except they can make themselves look good with pictures and text!

GET IT THIS INTO YOUR THICK SKULLS!!
Stop Paying for something thats not finished!!

For christ sake when are these people ever going to learn!?!

R.J.

On May 5, 2014 at 10:31 pm

If the suit is successful, it might at least encourage people behind projects to provide funding rewards that are economically feasible. Many of them make the mistake of providing rewards that add huge costs to the project and then end up citing that as an excuse as to why the project didn’t turn out as well as they had hoped.

AxΣtwin

On May 5, 2014 at 11:53 pm

“If Altius is held financially liable for failing to deliver, other devs may shy away from crowdfunding for fear of gaining funding but being unable to fulfill either rewards or refunds.”

……..and this is bad…why? In most cases, you don’t get the rewards if the project fails to get officially “kickstarted”. Why is it considered a bad thing that developers are expected to hold up their end of a bargain? This right here is a good portion of everything that is wrong with the gaming industry. So I have no sympathy for a guy that failed to deliver on his promises after making 10k over his asking goal. Furthermore, we should not be making excuses for him and start fearing for the future of Kickstarter because this guy is being sued for not delivering on a promise based on a financial exchange.

quicktooth

On May 6, 2014 at 1:31 am

As someone who’s been burned several times before by Kickstarter projects, I’m glad some kind of justice is being brought to the crowd funding scene. I’ve also been delighted with two projects (Shadowrun Returns and Base Raiders RPG, respectively), so I WANT the scene to succeed. But I’m not betting any more money until I get some kind of security in my pledges. I never consciously chose to stop funding projects, I just discovered one day that I had, and when I wondered why I realised that funding in the current system wasn’t worth it. Security or go home, thanks. If kickstarter or project makers can give some kind of guarantee, or at least actual justice if we get screwed, then I’ll come back. Not before.

Doy

On May 6, 2014 at 3:40 am

I agree with AxΣtwin. I’ve seen too many instances, mostly in the banking and property industries but present in all forms of business, where people who have failed to deliver on a promise (or, in many cases, have deliberately deceived the public and conned their way to huge riches) are not punished or used as a precedent for change because of a fear that it might prevent others from investing. “We can’t regulate multinationals or force them to pay tax because they’ll take their business elsewhere.” Let them. “We can’t force banks to pay back all that money they cost the economy or prevent them from awarding themselves six-figure bonuses because it’ll lead to a brain drain.” Good – we can do without brains such as theirs. It’s about time people realised they’re accountable for their actions and should not be protected just because a lot of money’s at stake. ‘Too big to fail’ is a concept that must be eradicated from Western culture.

Obviously this is kind of a slippery slope given that this story is on a much smaller scale, but it still applies. We should not be worried about Kickstarter losing lustre if this guy is punished – which I don’t believe it will anyway – we should be far more concerned about the terrible precedent it sets if he’s NOT punished for falling short of an assurance. This is no small thing we’re talking about, it’s thousands of dollars for a product that’s 18 months overdue. Hopefully this will send the message to potential investors that they are protected from deceit and failure. That’s a far more positive standard to aim for than ignoring a problem so more people are inclined to make the same mistakes knowing they won’t face any consequences for it.

Ron Whitaker

On May 6, 2014 at 5:32 am

@Axetwin – I didn’t mean for that to come off as me saying devs shying away was bad. What I meant was that it could be bad for Kickstarter, as that’s how they make their money.

I’m 100% with you on the idea that these folks should be held accountable, and I don’t really care if that’s bad for Kickstarter or not.