Virtual legality

Shyster! is a multimedia computer game that outrageously lampoons the American legal system. The interactive satire casts the player in the role of a shady lawyer as either the defense or prosecution. In playing the game, you select minute details about your alter ego: your gender, race, clothing style, and even fetish accessories like cell phones. As the game progresses, your character's mental state worsens from the stress of the trial, which will require psychotherapy, hypnosis, or chemical mood enhancers to rectify. All of these elements affect the way jury members and the judge react to you, and their decisions about the case.

The cases themselves are thinly veiled parodies of recent infamous ones--lawsuits inspired by the Exxon Valdez oil spill, the Rodney King beating, and the McDonald's lava-hot-coffee-scalding are a few examples. The game unfolds as a series of interactive video segments featuring professional actors in mock courtroom settings. To say that these actors' performances in this digital production are pure ham is an understatement. Shyster! is such a cavalcade of stereotypes and caricaturish overacting that "bad acting" and intentionally bad performances become one and the same. "Sophomoric" and "infantile" come closest to describing the game's humor and dialogue--which doesn't even rise to the level of Jim Carrey's schtick. Think Ernest Goes Legal.

But juvenile and asinine humor is what the game's creators, a small Texas firm called Museworthy, intended. From their modest offices in Addison, the three started work on Shyster! just over a year ago. They were certain then, as they still are now, that there's a market for a computer game that viciously pokes fun at lawyers. After all, as Jim Freeman, the 27-year-old CEO and president of Museworthy, enthusiastically claims, even real lawyers that they've spoken to love the idea behind the game and want to play it. Selling the game specifically to them, in fact, is part of Museworthy's marketing plan.

Whether lawyers or anybody else will get to play Shyster! is up in the air. The game that spoofs the absurdity of the legal system has itself become ensnared in a legal battle between its creators and their publisher, an L.A.-based company that's one of the major brands in the computer-entertainment industry.

"It's amazing--here we were lampooning the justice system, making fun of it, saying how most lawsuits are frivolous, how we can't believe how much money is spent in it, what a ridiculous system it is. But now, it turns out, we really need it," admits Freeman.

Museworthy's painful brush with the big time sounds familiar: A small group of talented young men get signed to a major label, but soon come face to face with--depending on your point of view--cynically broken promises, or just the harsh economic realities of the business. It could be the story of a local band signing to a major label only to have things go bad. Appropriately enough, the original members of Museworthy--Freeman, Jason English, 26, John Kelly, 27, and Joe Moseley, 27, even look like rock musicians.

Now, the whole legal mess that has resulted from this soured relationship--byzantine enough for an episode of Shyster!--could make Museworthy's second game its last.

"What the hell is Comdex?" John Kelly asked his partners after he got off the telephone. It was the summer of 1994. Kelly, Freeman, Jason English, and Joe Moseley were working on finishing post-production for their first game, Paparazzi!: Tales of Tinseltown.

Founded five years ago by Freeman as a "specialty" ad media company, Museworthy worked on various ad campaigns primarily for radio and TV. Its duties involved designing TV-spot animations and composing music jingles for other local advertising firms to use. It also devised entire marketing strategies for Dallas-area businesses such as Magic Rent-To-Own.

In early 1994, Freeman and English, the only fully employed members of the company at the time, decided to steer toward another venture. Even though their ad work remained profitable, Freeman says, he and English grew tired of spending their creative energies on promotional work. They wanted to create something that was entirely their own--something more fun than advertising.

Making a CD-ROM game--specifically, one that would use lots of video footage--seemed the way to go. The two's skills in desktop video production made it a natural, and Freeman had always yearned to direct a film.

Plus, multimedia software was hot at the time. The CD-ROM had finally come into its own as an economically viable means of software distribution and production. With a CD-ROM's enormous storage capacity, game and reference software could pack in several minutes' worth of video and audio. Most of this, however, would soon be overshadowed by the promise--real or imagined--of online connectivity. These were the days before the hype for the Internet and World Wide Web exploded and eclipsed nearly everything else in the computer industry.

English already had an idea for a CD-ROM game. Called Paparazzi!, the player would be cast as a photographer on the hunt for celebrities in compromising situations. The game would parody famous people in the entertainment business. It unleashed what would become the Museworthy trademark of interactive entertainment--outlandish satire with garish acting performances.

When John Kelly joined Museworthy that March for the Paparazzi! venture, he brought his experience from working at a small-market TV station in Sherman, Texas, and as a free-lance video producer. He and Freeman, fellow alumni at Berkner High School in Richardson, were previously acquainted with each other mainly because they had dated the same girl.

Joe Moseley brought additional music and computer-graphics skills when he was hired on for the project.

With money secured from outside investors and a script, video shooting for Paparazzi! began that summer. The small crew scrambled to set up scenes in restaurants, bars, alleyways, and other locales in and around Dallas, which stood in for Tinseltown. The cast was drawn locally and was mostly friends and family. The Museworthy principles literally got into the act, too. English played a rock star and Kelly a Sean Pennlike actor with a penchant for decking photographers. (At the time, English played bass in Half Inch Soul, a local hard-rock band. Kelly had once acted in commercials.)

It was a quickie guerrilla production in every sense, lasting for a month and requiring the four men, and a fifth employed for the production, to work six 16-hour days a week in the sweltering August heat.

Once they completed the shoot, they put their marketing talents, honed in their advertising days, to work. They sent out press releases to computer-entertainment magazines and similar publications. A representative for a Japanese distribution company read a brief notice about Paparazzi!'s production in one of these magazines. He called Museworthy about purchasing the Japanese distribution rights for the completed game.

Would they be attending the upcoming Comdex the representative asked.
Of course, Kelly answered nonchalantly--without a clue what a "Comdex" was.
Great, the representative responded. He and his associates would look forward to meeting with the Museworthy team and having a first-hand look at Paparazzi!.

As it turned out, Kelly had committed Museworthy, on short notice, to unveil Paparazzi! at a major computer-industry trade show. That year's Comdex (Computer Dealers Expo) was scheduled for November in Las Vegas.

"It was too late to get a booth," Kelly recalls. "So what we decided to do was just rent a hotel room. We had a friend who gambled all the time, and he got us a room in one of the casinos. We made our office there. We brought computers; we brought the programmer..."

"We were still finishing the game," says English. Paparazzi! wasn't fully working until minutes before representatives from the Japanese distribution company stepped into the room.

Apparently, they liked what they saw from the barely functional game and agreed at that moment to purchase it for distribution in Japan.

"Things seemed to come to us just at the right time," Kelly says. "Typically, they come to us when we need it most. And that was one case."

The Museworthy novices managed to pull off something unique at that time in the industry. In four months, from initial production to final programming, they completed a CD-ROM game that featured mostly live-action footage--and managed to find a distributor, too.

"After that, we kind of knew that trade shows were the way to go," says Kelly.

Buoyed with success, the members of Museworthy looked for their next trade show, which would prove to be even more significant.

Three months later in February 1995, English and Kelly drove a rental truck to San Francisco. They went with no stops or rest, trading off the driving duties to one another when necessary. Their destination was Intermedia, a trade show specifically for multimedia companies.

"This was kind of 'all or nothing,' says Kelly. "We were just shooting for some kind of American distribution or representation. We weren't really prepared for what was going to happen. We were just hoping somebody would pay attention."

The cargo their vehicle was carrying would turn out to be the key to their next step for success, and again it was their marketing acumen and advertising creativity, rather than programming savvy, that were working in their favor. It was a booth that they had designed and built themselves: a giant camera iris that opened to reveal a 55-inch TV monitor with Paparazzi! running on it. A brilliant strobe light simulated the flash of the mock camera and would draw the attention of people on the convention floor.

Again the Dallas novices wowed the multimedia pros.
"We were somewhat the hits of the show because our booth grabbed so much attention," Kelly says. It also helped immeasurably, Freeman says, that they, the creators of the game, were right there promoting their creation. It set them apart from the other companies, which had products hawked by people who had had no hand in developing them. "We made this thing, and I think that came across," Freeman says.

Immediately after the show, offers started coming. But the four young men kept their cool, carefully considering each one.

The most tantalizing offer came from Bill Anker, director of acquisitions and affiliated labels for Los Angeles-based Activision, a venerable gaming-software company with the second-largest development studio in the industry (the first belonging to Electronic Arts in San Mateo, California). Other companies were offering bids for American and European distribution rights for Paparazzi! with the possibility of considering other games Museworthy might produce in the future. Anker's offer, though, was much more enticing. He wanted to sign Museworthy to a contract for three titles, the first being Paparazzi!.

Anker visited the Museworthy offices, and, Freeman says, "The impression he gave us was, 'We want to keep you making titles. We want you to keep doing what you're doing.'" It was exactly what he and the others wanted to hear.

"Our deal wasn't 'walk in and walk out and make a million dollars.' Our focus was not about the bucks," he says. "It was about being able to make games. We wanted to have the opportunity to create."

A subsequent visit by Freeman and English to Activision's new Wilshire Boulevard offices impressed them, even though the company was just moving in. "It was kind of like we walked into this empty office," says English.

"It was really chaotic and...strange," concurs Freeman describing the vibe.
Formed in 1979 by video-game programmers who had defected from Atari Inc., Activision has had a long, historic life in the computer-entertainment business. In the late 1970s to early 1980s, when home video-game systems were the rage, companies like Atari not only made the hardware but all the software to run on their own machines. It took upstarts like Activision to pioneer and legitimize the idea of "third-party" software developers in retail buyers' minds.

Following some rocky years during the '80s, Activision was on a roll after producing a game last year that takes advantage of Microsoft's Windows 95 operating system. Activision formed an acquisitions department toward the end of 1995 with an emphasis on being "very selective," as Anker put it when he was profiled in the trade magazine Software Developer & Publisher. "We want product and companies that will provide us with games that we will be proud of and games that we can put the same kind of marketing and distribution muscle behind that we do with our own games."

During their visit, Freeman and English were introduced to people throughout the company's departments. Other than the confusion of 140 employees settling into new workplaces, everything else about Activision seemed to run smoothly.

Freeman was prepared to seriously discuss with Anker the specifics that he and his associates required in a contract with Activision. New to the multimedia business, he and English figured they would need to call upon their experience from their ad days in negotiating agreements. None of this turned out to be necessary.

"It was unbelievable that we didn't have to say anything," Freeman recalls of the not-so nitty-gritty discussion. "They said everything we wanted to hear. We were like, 'Yeah! You guys know what we need.' I felt they really had us in mind. They had already figured out what we wanted and what we were looking for."

So on April 7, less than two months after its big debut at the Intermedia show, Museworthy signed a contract with Activision worth a total of $500,000 and became Activision's first official acquisition.

"It really was like being in this band that just got signed," Kelly says. "Everything that we'd ever hoped for happened."

Under terms of the initial contract, Activision purchased worldwide (excluding Japan) distribution rights to Paparazzi! for $250,000. This contract, referred to as the Heads of Agreement, was signed by both parties. A formal contract that would be a more-complete version of the agreement, with lengthier legalese, was to follow within 60 days for signing by both parties.

The initial agreement states that the deal would be for three CD-ROM game titles to be produced by Museworthy for Activision. Paparazzi! and Shyster! are listed as the first and second titles, with a third only as "Product 3." The money for Paparazzi! was advanced in $50,000 increments. To date, Museworthy claims to have received from Activision $200,000 of the $250,000 total purchase price for this game.

Secondly, Activision promised to advance Museworthy an additional $250,000 for the production of Shyster! and Product 3. Museworthy, however, decided to invest all the money it would be receiving for Paparazzi! back into the production of Shyster!. By its own estimate, Shyster! would require a budget of $400,000. (The final $100,000 listed in the initial agreement was earmarked for Product 3.)

So with $200,000 already in the bank--and another $200,000 to come from Activision, the Museworthy team jumped into production of Shyster!. Even with financial backing and indoor shooting in an air-conditioned sound stage at the Stokes Group studios, Shyster! wasn't going to be any easier to make than Paparazzi!. Museworthy was aiming to make its second title big: 85 hours of footage to be edited down to fill a whopping 24 CD-ROMs. (Paparazzi! came in at 90 minutes' worth of video footage that took up only two CD-ROMs.) If Paparazzi! had been a made-for-TV movie, then Shyster! would be a bloated, epic miniseries.

Before shooting for Shyster! began, Kelly flew off to Los Angeles for the E3 (Electronic Entertainment Expo) trade show in late May of '95. He was there to help sell Paparazzi!, which would be one of the new games featured at the Activision booth.

After two trade-show triumphs, the third one, under the wing of an established software company, was a let down. "We were buried in the Activision booth," Kelly says pointedly. Without the light-and-mechanical special effects of the homemade display they used at the Intermedia show, Paparazzi! became lost in the crowd--just one of many games on display.

"I didn't really know what to expect," Kelly admits. "I felt, 'Wow, we're going to have a big company behind our booth now.' But I would've rather had them give us another 10-foot-by-10-foot booth so we could do again the exact same thing that we did at Intermedia. I think we could've promoted Paparazzi! a hell of a lot better than being under this 'umbrella' that Activision wanted."

Still, E3 seemed nothing more than a minor setback--the downside of selling your creation to a major publishing company. It was soon forgotten when studio production for Shyster! started the following month. Unlike Paparazzi!, it was a professional shoot from top to bottom. More than 100 local actors were hired to play the macabre cast of characters. Twelve of them, who had recurring roles, had to be paid each week. Costs for prop rental, costumes, makeup, electricity, and lighting piled up. The $200,000 payment for Paparazzi! that Museworthy had routed right into Shyster!'s production was rapidly being depleted.

During this time, Activision was coordinating the nationwide launch of Paparazzi! and wanted Museworthy to head up the Dallas premiere to be held in the West End. The Shyster! shoot had to be briefly halted while Museworthy and its own public-relations firm took on the responsibility. Considering it was to be part of a the nationwide premiere of the team's first creation, no one complained.

But Museworthy was soon dissatisfied with how Activision was marketing and distributing Paparazzi!. Not only was the national promotional rollout less than what Museworthy expected, but distribution fell beneath its expectations. Freeman complains that he had to go to the CompUSA headquarters in Dallas himself to ensure that the nationwide computer-superstore chain would increase its initial orders for the game from 300 to 3,000 units.

"It's a frustrating thing to have been an advertising company, having done full media campaigns with $500,000 worth of resources, and then to watch us hand over promotion of our own product," Freeman says.

Maryanne Lataif, Activision's director of corporate communications, told the Observer, "With any title we launch, we spend a considerable amount of time promoting it. For Paparazzi!, we did promotions in four major markets tied to radio sweepstakes, retail merchandising, and in-store advertising. So, we believed that we promoted the product in the same manner which we would have promoted any of our other products. We did as much as we could."

Still, a bright moment came when nearly all the reviews received for Paparazzi!--more than 30 of them--were positive. Paparazzi! received four-star ratings from Computer Life and Multimedia World. Critics at other computer magazines and newspapers gushed that "the humor is fantastically tasteless," "it's so addictive," and "this is a very creative CD-ROM that's worth taking a look at if you want to try something new."

Meanwhile, Museworthy had pushed ahead to complete shooting the 300-page Shyster! script in six weeks. But a more ominous problem cropped up after the shoot wrapped in the middle of July 1995. Activision failed to deliver the final $50,000 Museworthy expected for Paparazzi!.

When he called Anker about it, Freeman mentioned that Museworthy was funneling the Paparazzi! payments into making Shyster!. Anker told him they should go ahead and satisfy the first agreed-upon requirement for earning the first $50,000 advance for Shyster!, which was to turn in the game's complete script. Freeman was reluctant to hand it over because he feared the money promised in advance for Shyster! might get confused with the final $50,000 payment still owed by Activision for Paparazzi!.

In the end, Shyster!'s post-production realities forced Freeman to relent. He sent the script to Activision and took the advance money marked for Shyster! before receiving the final payment for Paparazzi!.

Money only became more of a nagging problem. The post-production for Shyster! would incur costs for editing the video footage, composing music, and work hours for designing and programming the game's interface. It's in post-production that a CD-ROM comes together.

Activision came across with a second $50,000 advance for Shyster!, bringing the total to $100,000, but balked at any more. And Museworthy still hadn't received the final $50,000 payment for Paparazzi!. In all, Museworthy was short a total of $100,000 of the $400,000 promised in the initial agreement for both Paparazzi! and Shyster!. Museworthy's financial situation got to a point that caused Freeman to feel it was necessary to seek outside private investors for extra funding.

Museworthy was struggling its way to deliver its second game when the formalized contract finally arrived on July 3, 1995--a month later than agreed upon and very different from what Museworthy had expected.

Gone was any reference to a third title. Second, Activision claimed the right to decline publishing Shyster!, and, if it decided thus, Museworthy would have to reimburse all advances on the game (now totaling $100,000). This was not anything like the initial contract that Museworthy signed, Freeman and Kelly say.

Museworthy returned the formal contract unsigned. Faxing and calling, Freeman put pressure on Activision to send another formalized contract.

When it came in September, Museworthy didn't find it any better. While this second version of the formal contract restored the three-title deal, Activision would, oddly enough, have the option to pull out of both the second and third titles--a business relationship Museworthy believed unworkable.

Kelly surmises the change in agreements may have resulted from poor sales of Paparazzi!. Activision declined to provide the Observer with any sales figures, but Lataif did say of the 30,000 copies of the game that were distributed, sales were poor and returns high. An initial distribution of 30,000 copies for a new computer game is considered a reasonable number in the business. Museworthy originally believed that Paparazzi! could sell 20,000 copies, though this may have been unrealistic to expect.

Lataif denies that Paparazzi!'s sales had any affect on the way later versions of Museworthy's contracts were handled and worded. "Contracts with Museworthy were finalized way before the product was even acquired," Lataif says. "We don't negotiate a contract after we've acquired a title. We make our contract negotiations prior to the acquisition."

In November, due to the lack of advances that Museworthy had expected to receive on a scheduled basis from Activision, Freeman says he had to lay off Joe Moseley. At that point, the dispute between designer and publisher over a CD-ROM game that satirized lawyers had escalated to the point that real lawyers--from the Wilson, Elser, Moskowitz, Edelman & Dicker firm representing Museworthy--entered the fray. Like the game, the dispute now was complete with conservative suits, cell phones, and convoluted legal maneuvers. But this time it wasn't a laughing matter.

On November 16, 1995, Museworthy filed suit against Activision in U.S. District Court, Northern District of Texas. Museworthy is demanding the final $50,000 for Paparazzi! as well as additional, unspecified damages. Activision tried to move the case to California but was denied.

"This lawsuit is not about Paparazzi!'s sales figures," says Freeman. "Although they did not promote the game enough and didn't do a very effective job at it, that's not what the lawsuit's about. The lawsuit's about not performing under the contract."

Museworthy also claims in the suit that, besides skipping the final payment for Paparazzi!, Activision lowered the retail price of the game to offset sluggish sales--without Museworthy's consent. Freeman says Activision's actions jeopardized Museworthy financially--forcing the company to lay off Moseley and making it impossible to have Shyster! ready for the 1995 holiday gift-buying season. "Museworthy suffered pecuniary losses and damages in an amount that exceeds $50,000," the suit claims, " justifiably relying on Activision's misrepresentations."

Museworthy nearly went bankrupt, Freeman says. "It's amazing we're still a company."

Though not a part of the suit, Museworthy feels that Activision marketed the game to the wrong audience. A game like Paparazzi! usually doesn't appeal to the typical computer-gaming crowd that's drawn to more action-heavy fare. English says Activision seemed to understand that. "They said it might take a while before Paparazzi! found its audience," he says. "After all, Myst [a graphics-heavy, narrative-based CD-ROM] took nearly a year before it caught on."

Activision was disappointed with the game's appeal. "We all had expectations that Paparazzi! would cross over into a larger segment of the population. And when it didn't, we had concern over other products that we were going to potentially acquire because we had paid development money toward those projects."

Freeman believes that, for Activision, the deal with Museworthy was a relatively painless "roll of the dice"--Paparazzi! was something that Activision could throw a relatively small amount of money at to see if it would be a quick hit in the marketplace. If the game didn't hit it big right off, he says, Activision figured it could just cut its losses and pull out of the deal.

"We were really sweet-talked," Freeman admits. "The three-title deal got us, and I think they knew that's what we wanted. They stroked our egos. They built our confidence."

A director of product development at another entertainment-software publisher who chose to remain anonymous confirms that three-title contracts, while not the rule, aren't unusual in the industry. Whether such long-term deals make wise business sense in the constantly fluctuating software market is another matter entirely.

Meanwhile, the legal case continues to imitate the game. On April 12, 1996--just more than a year from the day when Museworthy got signed to the multimedia big time, Activision filed a cross complaint to Museworthy's suit. The publisher claims that it was Museworthy that breached the contract by refusing to turn over Shyster!. Activision not only seeks $500,000 in damages from Museworthy but has filed a complaint against Freeman himself.

The Museworthy team considers Activision's most recent actions just a maneuver to get Museworthy to drop its original suit. Before the counter-suit was filed, Lataif told the Observer that Activision only wanted the advances it provided for Shyster! returned--a total of $100,000.

For its part, Museworthy initially sought the final $50,000 payment for Paparazzi! but now asks for $1 million in damages, considers that Activision holds no claim on Shyster!, and wants a full accounting of the sales of Paparazzi!.

"We were dealing in good faith when we took a risk with Activision because they were taking a risk with us," Kelly says.

"They had us figured out," says Freeman. "I feel really duped."

The three-man operation that is now Museworthy continues to push to finish Shyster!. More investors are being sought to fund the game's distribution and marketing, which Museworthy plans to coordinate themselves. The goal is to release Shyster!'s first court case this summer, with additional cases available later this year as packaged sets and through a subscription service.

A basic marketing plan provided to investors, "CD-ROM Publishing The Museworthy Way," lists how Shyster! will be made available via the Internet, mail-order catalogs, and the shelves of book and magazine retailers. Promotions will be carried out in such outlets as legal trade publications, court-TV shows, and satire magazines. There is no mention of retail markets where one would immediately expect to find computer software. This is similar to how the members of Museworthy felt Paparazzi! should have been marketed but wasn't.

Still, it may not be enough. There's a growing feeling throughout the computer-gaming industry that multimedia-laden games like Paparazzi! and Shyster! are financial sinkholes for developers, simply because not enough people seem to want to play with the stuff. A major part of this problem is that the overall multimedia genre is flooded with products. That's because most multimedia software, like Museworthy's games, is produced on an industry-recognized software engine, Macromedia's Director. For $900 for this rather easy-to-use program, you, too, can make games like Museworthy's. Regardless of the quality of individual titles, this democratization of digital media production unleashes a glut of inevitably similar products into a market with limited demand.

Freeman disagrees with this assessment: "If you're smart and don't spend way too much money making it, there's an opportunity to make some money," he insists. "If you sell 20,000 units, you can make money."

Activision seems to have concluded otherwise, at least when it comes to Museworthy and its creations. And the publisher appears reluctant to simply write off its relationship with Museworthy as a bad gamble.

"It's been painful," Freeman reflects. "We put so much into this thing, and I feel I let a lot of people down, the whole group, by going with Activision. We're not only disappointed, but, from my perspective, I also feel responsible. It kills me to see the dream not given the opportunity it should have.


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