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What We Can Learn From a Game Studio Co-Founder’s Public Tirade

It should have been a celebration. It’s been more than four years since the last “Borderlands” game and more than six since the last developed by series creator Gearbox.

Instead, the “Borderlands 3” reveal has been almost entirely overshadowed by the behavior of Gearbox CEO Randy Pitchford. A days-long, profanity-laden campaign directed at Game Informer and fans over a perceived slight related to a social media headline on an otherwise innocuous story clarifying contradictory messaging from the May 1 reveal event stole the spotlight.

Pitchford chose to take the scrap public instead of dealing with it privately. It’s not like he doesn’t have a relationship with Game Informer. The magazine has regularly featured “Borderlands” games and revealed the first title in the series in its September 2007 issue as an exclusive.

When asked why he chose to make a spectacle of the situation, Pitchford pointed to past experience. “I had learned through our PR rep that GI’s position was doubling down on their insinuation,” he wrote on Twitter. “Reason would not prevail, so I defend on the very forum they attacked on – Twitter. Prior experience has taught me that I am better off with a public dispute than let a lie go unchallenged.”

Pitchford’s missteps didn’t end here. As Variety reported, a separate public dispute with David Eddings (a former Gearbox vice president and the original voice of “Borderlands” series mascot Claptrap) escalated. It began with a disagreement of facts over Eddings’ request for payment turned into resurfacing of an ongoing lawsuit that involves alleged lewd behavior and a secret $12 million bonus.

Eddings most recent claim is that Pitchford assaulted him in the lobby of a hotel at GDC 2017. Eddings followed it up a day later, indicating that he reported the matter to Gearbox HR and was fired a day later.

Variety posed a number of questions to Pitchford about the incident with Game Informer and asked specifically about a response to Eddings’ allegations. Rather than answer the questions, Gearbox provided the following statement:

“We believe that being trustworthy to our community is a very important pillar in being a great video game studio,” a studio representative told Variety. “This can be reflected in how we chose to show off Borderlands 3 with live gameplay front and center. This specific incident on Twitter happened in the heat of the moment, but we are going to focus on handling these sort of corrections through the proper parties and traditional channels in the future. We’re confident that the game will continue to speak for itself and we have some pretty exciting news and previews for E3.”

While not outright saying that Pitchford’s approach was ill-advised, the studio’s assertion that it will handle things “through the proper parties and traditional channels in the future” is a tacit admission that things went off the rails. Gearbox also provided a separate statement about Eddings’ assault allegations.

“Gearbox takes any and all claims of this nature very seriously and we will abstain from commenting on the allegations Dave is making because it is a personnel matter,” the studio says. “We think it’s a shame that the 400+ employees here who have poured the love and passion into Borderlands 3 are having their work be diluted by personal allegations.”

2K Games did not respond to Variety’s request for comment at all.

Eddings tells Variety that he was fired from Gearbox for refusing to disclose the identity of an individual that gave him credible information that Pitchford was entertaining offers to sell Gearbox. That conversation led to the alleged assault after Eddings refused to out his source. According to a Newsweek report, there were two witnesses to the incident, one of which corroborated Eddings’ account. The other says he did not see it take place.

Additionally, Eddings shared images with Variety documenting a profanity-laced text message exchange with Pitchford following the altercation. He also provided Variety with pictures of bruises on his abdomen he says are a direct result of Pitchford shoving him. Eddings says he did not file a police report. Gearbox declined to comment further when asked about these additional details.

Much of this—the Game Informer dispute, the resurfacing of the lawsuit, and Eddings’ assault allegation—could likely have been avoided if Pitchford just stopped talking. Unfortunately, there doesn’t seem to have been much that Gearbox staff or “Borderlands 3” publisher 2K could do to ease Pitchford’s frustration (or at least direct it away from social media).

“A lot of times with leaders of businesses or CEO-types who are self-made, there’s not a lot of advisement taken into consideration for things like this – especially knee-jerk reactions on social media,” says a veteran PR professional in the games industry that requested anonymity. “They are their own best champion because they’ve created something successful, but at the same time they can also be their own worst enemy.”

Despite the multi-part outburst, it isn’t likely that sales of “Borderland 3” will take a hit (even if this controversy dogs the game throughout its pre-release hype cycle).

“A Twitter outburst and subsequent negative press probably isn’t going to greatly affect sales of a game with this big of an audience behind it—an audience with a majority of people not hyper-connected to games Twitter or reading tech entertainment sites daily,” the PR source says. “Sure, the press don’t like it and the most hardcore fans are going to notice and get involved, but we’re talking about a game that has sold millions upon millions of copies to a ‘hit-buyer’ demographic who buy maybe 6-8 games a year. Can you imagine some distribution manager at Walmart sitting there in her office saying, ‘Well, Randy was mean to Game Informer on Twitter so we’re canceling orders of ‘Borderlands 3.’  Let me call up 2K and let them know?’ That’s not happening.”

Pitchford admits he went off-script on stage and began ad libbing. There is no way to know if anything was scripted for Pitchford or if a scripted version would have been clearer. He’s a showman and skilled magician. He often plays to the crowd, and engaging an audience means being willing to deviate from the plan. That skill worked against him here.

The PR expert suggests that the misstep could have been easily corrected with a clarification from Pitchford. Acknowledging he misspoke would have quickly ended the matter and allowed everyone to move on. Despite the outburst, it’s not Game Informer who needs an apology most from Pitchford. It’s the Gearbox development team, which has been eclipsed by the studio CEO’s drama (making the statement about Eddings ‘diluting’ his former colleagues work particularly ironic).

This also could impair recruitment when the studio needs to staff up. As an independent studio that has worked with different publishers, it also might harm Gearbox’s ability to find work outside of its relationship with 2K (which, at least outwardly, doesn’t seem to be damaged by Pitchford’s behavior).

A publisher that does decide it wants to work with Gearbox but is hesitant because of Pitchford’s recent behavior and current legal issues could exact a “Randy Tax” by offering the studio less favorable revenue-sharing terms. A partner could also craft the contract in such a way to limit Gearbox’s ability to communicate with the public.

“Generally speaking, in a development, partnership, or licensing agreement, there will be a section on how the product or service is to be marketed,” says attorney Richard Hoeg of The Hoeg Law Firm. “After all, in many respects, ‘marketing’ is one of the primary assets that a publisher is offering to a developer.  So the marketing provision itself could have language that, for example, says the publisher is the only one who can speak in connection with the product, or that the developer can also speak—and/or make marketing materials like trailers and the like—but only with the consent/management of the publisher. This second case is the more likely, because prospective customers will expect to hear from the folks actually making the game.”

Hoeg points to the contract between Activision and Bungie for “Destiny” (prior to the two companies parting ways) as an example of how this might read. The situation is similar to the 2K/Gearbox relationship, as Gearbox owns the Borderlands IP and 2K is the publisher. In the “Destiny” contract, Activision is clearly in charge of marketing, but Bungie was able to approve all the plans around that activity. Bungie was able to communicate with the public, but only following Activision approval.

“If a publisher really wants to work with a developer, a section like this will wind up more developer favorable,” Hoeg explains. “If the developer lacks leverage—is the one more desirous of the relationship—the publisher may well impose more restrictions.”

A publisher who wants Gearbox’s talent, but might want to leave the drama behind may opt for onerous language around marketing and communication with the public.

“For the harshest treatment, I’ve drafted provisions in my practice that read as follows: ‘Developer may not make any public announcement, communication, or disclosure regarding the existence or subject matter of this Agreement, or the content or form of the Application, unless it first obtains Publisher’s written consent, which may be withheld in Publisher’s sole discretion,”’ Hoeg says. “That said, such a provision is less than ideal, because of the expectation that the developers will be talking about a major AAA project they are working on.”

Contracts often include remedies related to breach. In the case of stringent language restraining Gearbox from making comment about a project, a publisher would have laid out options for enforcing its rights.

Hoeg explains that these are typically in the form of indemnification (paying for damages) and termination of the contract (accompanied by a refund of funds paid by the publisher). In the “Destiny” contract, Bungie agreed to indemnify Activision in the case of contract breach.

“Let’s say Bungie went out with some materials that were not approved by Activision—even though they are required to not withhold approval unreasonably—and those materials resulted in Activision getting sued in some respect, then Bungie would owe Activision for the suit,” Hoeg explains. “For contracts that are more publisher-favorable, a breach will be proportionately easier to prove.”

It’s also possible for one party in a contract to sue for breach if there are direct damages. If 2K’s contract with Gearbox includes similar language, a suit would be possible, though highly unlikely. “In order to win a claim here, 2K would have to show that it would have received more money—likely much more given the cost of litigation—had Mr. Pitchford not spoken,” Hoeg explains.

In other words, 2K would have to demonstrate that Pitchford’s actions in the public square negatively hurt “Borderlands 3” sales to such a degree that the amount lost would outstrip the cost of taking Gearbox to court (and in the process, likely severing the relationship either directly or by making it untenable to continue). At that point, clauses related to termination of the contract due to breach would kick in.

“Termination is generally an imperfect solution, because, depending on the contract, it might be unclear as to whether a publisher can seek a refund of advance funds, and such funds might have been spent in any event,” Hoeg says.

These are avenues of last resort for a number of reasons. Hoeg explains that the optics are bad (the headlines around a publisher suing its development partner aren’t good PR) and both parties in the contract have a vested interest in a game’s success. Instead, clauses in contracts are intended to act as a deterrent, and neither party wants to see that sword wielded.

“It is in both side’s best interests to generally let something like this blow over, with the expectation that by launch it will be forgotten,” Hoeg says. “Obviously, if it persists there may be further action required.”

From both the public relations and legal perspective, 2K is likely to stay quiet on Pitchford’s outbursts. There is little to gain by fanning the flame and even less when it comes to enforcing contractual clauses that may exist in their agreement.

However, Gearbox is positioning itself for tough negotiations in the future if it hopes to work with other publishing partners. A publisher’s legal counsel would consider past behavior when crafting a contract, and the public relations team would also want to ensure that Pitchford doesn’t go off-script minorly like he did at the “Borderlands 3” reveal event or in a more significant way as was alleged in a legal dispute between Sega and Gearbox surrounding the poorly received “Alien: Colonial Marines.”

Gearbox and 2K would do well to let time heal the wounds created around the “Borderlands 3” reveal and the subsequent outbursts. Eddings has requested an apology from Pitchford to put the assault matter behind them and move forward. Even if Pitchford doesn’t believe Eddings is entitled that gesture (or doesn’t think he can make one because it might expose him to legal liability), Gearbox developers do deserve to have these distractions put aside. It’s their work on “Borderlands 3” that should get the spotlight, not the studio CEO’s antics.

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