Dust Tactics Legal action from Dust studios against Battlefront?

Forum adverts like this one are shown to any user who is not logged in. Join us by filling out a tiny 3 field form and you will get your own, free, dakka user account which gives a good range of benefits to you:

No adverts like this in the forums anymore.
Times and dates in your local timezone.
Full tracking of what you have read so you can skip to your first unread post, easily see what has changed since you last logged in, and easily see what is new at a glance.
Email notifications for threads you want to watch closely.
Being a part of the oldest wargaming community on the net.

If you are already a member then feel free to login now.

**Alpharius**

Has this interesting wrinkle already been posted?

(From Tabletop Gaming News)

http://www.tabletopgamingnews.com/a-reply-from-dust-studio-about-project-babylon/

Dust Studio and Battlefront are having issues with the release of Project Babylon, the next expansion for the popular alternate-history Dust game. We’ve recently heard from Battlefront, and have been in contact with Dust Studio. Here’s the latest reply, straight from Mr. Paolo Parente.

When in Spring 2013 Dust Studio and FFG decided to split, FFG offered to honor the time clause of our agreement
that obliged them to buy what was called Wave 8 and 9 of products: The miniatures around the Campaign Box “Operation Achilles” to be precise, three months of releases plus the wave around the Second Edition of the rules (another 3 months of releases).
Battlefront was eager to start distributing DT immediately and decided to offer FFG to buy wave 8 instead of them. For Dust Studio it looked good because BF was giving higher margins than FFG, for FFG was good because they were set free from their contractual obligations. ln short everybody was happy…

Wave 9 was planned to be released in Autumn 2013, this was about the New Starter Sets, 2nd Edition Rulebook and a few re-edition of older models. Dust Studio had financed this wave under a Factoring Bank that basically anticipated the funds to us based on the Purchase Orders released by BF in January 2014 (attached).
BF had 90 days as payment terms. They had to pay for the goods directly to the Factoring Bank. Unfortunately that payment never happened (breach of the distribution contract) and of course the Bank started chasing us first and subsequently BF.
at this time we assumed that BF were in light financial troubles
so we did not decide to stop working with them but tried to find a
way to help instead.

Spring 2014. In those very stressful days we decided to run a KS to release new items (there was a lack of new products releases on the market) and at the same time raise funds and allow BF to pay their debts towards the Factoring Bank.
We proposed a typical KS agreement where both parties equally shared the profits. BF refused that agreement and proposed the one attached here. Where BF would simply buy the goods from DS and
keep the profits for them mainly to ensure the payment of those overdue invoices to the Factoring Bank.
Dust Studio CEO Mr. William Yau reluctantly signed the agreement and the Babylon KS campaign started.

The agreement obliged BF to immediately pay Dust Studio for the goods upon receiving the funds. This was done on October 7 2014, the attachment named DS 141K. This was the payment for
the so called “Babylon Wave 1″. Of Course before that BF paid the Factoring Bank DBS those overdue invoices (breach of our KS agreement).(attachment DBS 220K)

Data about the sales NOT a Purchase Order was given to DS in November ?and we all know that BF have been collecting orders and Payments via the Pledge Manager until January 2015 (2 more months). Making the data received in November not accurate at all.

Without ever passing us the data of the totals of miniatures sold, nor a P.O. or a payment.
Tired of begging for what is simply due to us Dust Studio have decided to share this information
with the public.
We just want what is ours, complete production and deliver the goods to the backers.
Who in the end, like us, deserve much better than being fooled around, right?

Discussions rotate around the free items that BF offered during the KS campaign. They refuse to pay DS for them. Now this would be natural if our contract did not see DS as a mere manufacturer. But since BF decided not to share the profits DS CEO refuses to share the losses and insists for BF to honor the contract.

The Backers money has payed for their debts basically giving them months of releases for free, which they keep selling making profits…

Follow the link to see two "Payment Reports"...

**BrookM**

Maybe it's just me, but rather unprofessional to share those two documents like that.

**Hekal Xul**

BrookM wrote:
Maybe it's just me, but rather unprofessional to share those two documents like that.

The only thing I see as unprofessional is BFs handling of the Dust license, the relationship with their business partner, the way they have treated the KS backers and their organisation of the KS..
Excellent share and some real home truths revealed.

And, to be fair. BF are doing an awesome job of trashing the present and future reputation of his creation. Maybe this will be the death of their partnership, who knows?
It would mean though that BF miss out on a great financial opportunity, but Paolo's would be stuck with a brand that no-one will want to touch.

**overtyrant**

Hekal Xul wrote:
BrookM wrote:
Maybe it's just me, but rather unprofessional to share those two documents like that.

The only thing I see as unprofessional is BFs handling of the Dust license, the relationship with their business partner, the way they have treated the KS backers and their organisation of the KS..
Excellent share and some real home truths revealed.

If everything that DS has said is true then BF will get none of my money and I will spread the word to my gaming groups not to buy any BF products (not that I or they do but I definitely won't now!).

**Starfarer**

BrookM wrote:
Maybe it's just me, but rather unprofessional to share those two documents like that.

I would not call it unprofessional since per the Kickstarter terms of service backers have a right to know about any delays and what steps are being taken to resolve them.

BF is basically remaining silent besides a few "updates" which more or less say nothing. Keep in mind these were only sent out after DS went public about the issues forcing BF into a position where they had to say something.

Paolo seems to be looking out for his IP, which is his livelihood. What does he have to lose at this point? If everyone stays silent and we knew nothing of delays the game would be taking just as bad of a hit as if he speaks out in an "unprofessional" manner. Even the most ardent supporters are on the verge of bailing, and I don't blame Paolo one bit for going public on this.

As for Major Malfunction's advice, I don't know if getting a refund will work at this point. Granted, I got mine back, but it took three months of badgering, and finally informed them I had hired an attorney(he happens to be a close friend and this cost me nothing, so I can't say that is advisable for everyone).

I would say everyone who is a backer needs to report this to Kickstarter. They are honestly unlikely to do anything, but enough reports my raise a red flag and get them to step in. This is a clear breach of Kickstarter TOS to pay outstanding debts with KS funds, and I think it really damages the credibility of their reputation if they do nothing to enforce their own TOS. Then again, if they aren't notified they won't know, so go report it if you backed it!

**Major Malfunction**

BrookM wrote:
Maybe it's just me, but rather unprofessional to share those two documents like that.

What I think is unprofessional is to take money from people under the premise of an accelerated delivery schedule, and then short the people that funded the whole expedition on their orders while you deliver the very same items to your business customers because they have store accounts with you.

**Piston Honda**

Battlefront in financial trouble?

color me shock.

**CaulynDarr**

Piston Honda wrote:
Battlefront in financial trouble?

color me shock.

Maybe, or that was just Paolo trying to paint BF in as negative a light as possible. I could be that DS came after BF for that 200K at a bad time. Even a successful small company is going to have issues with that much money without breaking it into installments. Their working relationship was pretty new, so there could have been some miscommunication about expectations.

I do find the whole factor bank thing confusing. So Dust takes money from they bank to manufacture a wave, but BF has to pay the bank? Maybe someone who know manufacturing/finance can explain that better.

I ran some numbers based on the what was in the contract and the pledge levels. There wasn't enough money to pay for the rewards and the 200K dept. By paying the bank off first, that left DS on the hook for the shortfall. The contract does look like BF should have payed for the KS rewards first, and the bank with the remainder. So, not cool BF. On the other hand, does it really matter? They where still going to be in debt no matter how you cut it. And that doesn't even account for who was paying for all the stretch goal freebies.

Automatically Appended Next Post:
Ok, looked up what a Factor bank was. It's a bank you sell your accounts receivable to(usually at a discount). So it looks like BF sent an invoice with orders for wave 9 to DS, who then sold that invoice to a factor bank for cash right away. I don't know if that is a standard thing companies do, but if maybe BF wasn't expecting that, I could see that as a cause for friction in their business relationship.

**warboss**

CaulynDarr wrote:

Ok, looked up what a Factor bank was. It's a bank you sell your accounts receivable to(usually at a discount). So it looks like BF sent an invoice with orders for wave 9 to DS, who then sold that invoice to a factor bank for cash right away. I don't know if that is a standard thing companies do, but if maybe BF wasn't expecting that, I could see that as a cause for friction in their business relationship.

I suspect the bigger cause of friction would be BF receiving $200,000 worth of merchandise and promising to pay within 3 months only to still have an outstanding bill for the amount 7 months later... and then robbing peter to pay paul (breaking their word yet again via their kickstarter terms) and then not having enough yet again to pay for models. At least this time to their credit, DS didn't just fork over the models on a promise to pay but wants the money upfront.

**Jehan-reznor**

Starfarer wrote:

Paolo seems to be looking out for his IP, which is his livelihood. What does he have to lose at this point? If everyone stays silent and we knew nothing of delays the game would be taking just as bad of a hit as if he speaks out in an "unprofessional" manner. Even the most ardent supporters are on the verge of bailing, and I don't blame Paolo one bit for going public on this.

I am not sure if this is the way to go, the openly way in which this is happening may be detrimental to the brand.
I hope it doesn't take down both companies

**SeanDrake**

All sounds like palo taking advantage of the situation to get BF to pay off outstanding debt from ffg era and then screw them over so they can distribute direct.

**Hekal Xul**

MrMoustaffa wrote:

Still having a hard time believing this is malicious on Battlefront's end though. Anyone who knows remotely anything about Flames of War knows Battlefront couldn't get a release right if their life depended on it, why should this be different? I've had models that took 6 MONTHS to get in, models that already had the molds done and had been released for years, and that's considered fairly normal amongst the FoW community. I'm kind of amazed people didn't notice this when they were researching the two companies before backing, I would have thought that the constant delays Battlefront is notorious for would be a huge red flag in it's own right.

Backtracking a bit and adding.
BF's responsibility in this undertaking was to organise the KS first then handle the distribution second. Here they weren't even directly involved in the hub distro. that was allocated to the company that supplies BF products locally.
All of the manufacturing/packaging etc which in itself is a fair undertaking, was handled by DS. BF's crucial part in the KS was to collate numbers of items required based on information submitted in the Pledge Manager, make out a purchase order and send it to DS. Basically an administrative middleman position.
That's all they had to do....
So, people could be forgiven in thinking surely they can't f@#$ this up? There's even comments on the KS page that reflect this.
Now according to Paolo they were still at in January and he's asked the backers to circumvent BF and send their invoices to him directly ? Seriously?
And communication, something that's crucial in running a business especially one that revolves around a socially interactive hobby and an avenue that's so easy to access these days..
How to they rate?
F@#$ing hopeless.

My hope, beyond the KS, is that they ditch any thought of continuing with BF. And that comes from knowing about their rep previously, seeing how they handled the license (on the forum, blog etc) plus their attitude to the gamers/fans of the universe be it KS related or whatnot. Plus there's no denying they have financial issues. Toxic, get rid of them.

**katfude**

From worldofdust.net in regards to dust-tactics.com not working:

Until recently, this website was accessible through several different domain names. One of these, www.dust-tactics.com, is owned by Dust Studios, who have decided to discontinue this domain.

From now on, the best way to access this site is to use the domain www.worldofdust.net. The website content remains unchanged, and will continue to offer support for Dust Tactics, Dust Tactics Battlefield and Dust Warfare, along with our active discussion forum.

We apologise for any disruption or inconvenience.

**Sining**

CaulynDarr wrote:

Automatically Appended Next Post:
Ok, looked up what a Factor bank was. It's a bank you sell your accounts receivable to(usually at a discount). So it looks like BF sent an invoice with orders for wave 9 to DS, who then sold that invoice to a factor bank for cash right away. I don't know if that is a standard thing companies do, but if maybe BF wasn't expecting that, I could see that as a cause for friction in their business relationship.

As someone who works in a manufacturing/exports industry, factoring is a VERY normal thing to do. And iirc, it's the person who's owed the money who has to pay a certain % to get the money earlier than stated in the invoice. So in this case, it would be DS who's paying a certain % to get the money. I don't see how this affects BF at all, other than the fact that banks are probably a lot harder to 'negotiate' BF-style with than smaller manufacturers.

**JohnHwangDD**

BrookM wrote:
Maybe it's just me, but rather unprofessional to share those two documents like that.

It is far more unprofessional not to live up to one's business commitments, something that BF is clearly not denying. At no point have I seen BF claim that "we have fulfilled *all* of our obligations per the terms of the contract that we signed".

**BrookM**

Riiiiight, sorry folks, not picking sides here, so no need for the PM's educating me, it just struck me as such because he's throwing files out there with bank account numbers and whatnot.

**Siygess**

BrookM wrote:
Riiiiight, sorry folks, not picking sides here, so no need for the PM's educating me, it just struck me as such because he's throwing files out there with bank account numbers and whatnot.

Actually I'm with you on this. Assuming even half of what we are hearing is true, there is no denying that BF have acted solely in the interests of their own company and to hell with everyone else and contractual obligations. But as the old saying goes, two wrongs don't make a right and I'm a little concerned that - irrespective of what BF have or have not done - companies are going to be very reluctant to work alongside a partner (DS) who might kiss and tell at the slightest hint of trouble. I don't know, maybe Paolo really feels this is the only course of action he has left but this really, really doesn't bode well for the future of DUST.

**Duncan_Idaho**

Well, going all public with disagreements is generally considered a bad idea in the business-sector.

**Yodhrin**

Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Erm, aye, but that's a bad thing. Capitalism is supposed to consist of informed participants on all sides, including the customers. Frankly all information about a company and how they do business should be public knowledge unless it directly relates to their IP or their business model is their IP. Whether out of self-interest or genuine concern for backers, Paolo has done them and other BF customers a service, it's a shame a few folk are seemingly much more concerned with business etiquette than the fact BF appear to be in breach of contract and happily screwing their KS backers.

**Piston Honda**

After the dust settles from this catastrophe, I wonder if anyone would even be interested in being a distributor for DS? They are on their 3rd distributor in 5 years. AEG, FFG, Battlefront

**Moopy**

Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Exalted.

**His Master's Voice**

Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

You don't get to solve issues like that while puffing a cigar in the gentleman's club, a glass of brandy in your hand when you have a rather significant number of backers (or rather customers) who paid and have not received product because of your "disagreement".

Perhaps if you want to follow the gallant and noble business sector rules, stay away from Kickstarter?

**lord_blackfang**

Yodhrin wrote:
Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Erm, aye, but that's a bad thing. Capitalism is supposed to consist of informed participants on all sides, including the customers. Frankly all information about a company and how they do business should be public knowledge unless it directly relates to their IP or their business model is their IP. Whether out of self-interest or genuine concern for backers, Paolo has done them and other BF customers a service, it's a shame a few folk are seemingly much more concerned with business etiquette than the fact BF appear to be in breach of contract and happily screwing their KS backers.

And I'll Exalt this one.

**Krinsath**

Yodhrin wrote:
Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Erm, aye, but that's a bad thing. Capitalism is supposed to consist of informed participants on all sides, including the customers. Frankly all information about a company and how they do business should be public knowledge unless it directly relates to their IP or their business model is their IP. Whether out of self-interest or genuine concern for backers, Paolo has done them and other BF customers a service, it's a shame a few folk are seemingly much more concerned with business etiquette than the fact BF appear to be in breach of contract and happily screwing their KS backers.

Actually capitalism has nothing to do with the disclosure of information, especially to the public. That's more of a "fair market" principle, while straight capitalism is more to the side of the free market where the private owners regulate themselves (i.e. - exactly what Dust is NOT doing). While the fair market ideals are certainly preferable to me being a consumer, the reality is that it's a capitalistic world for the most part because those closed-door meetings and "away from the public eye" shenanigans is how business actually gets done. Generally involving the public is a horrid idea because groups of people are by and large idiots ("None of us is as dumb as all of us", etc) and it's simply going to make things dramatically uglier. Think of most any project you've ever worked on; the addition of more and more people to the conversation with competing views and desires is very rarely productive.

This will not be a fact lost upon future business partners for Dust Studios, which is why it's an incredibly stupid idea for the long term. Yes, you will get the public to exert pressure on an intransigent partner, and that might move the line in your favor in negotiations. Then BF drops Dust (at this point I don't see how there can be a working relationship going forward), and every other company has to look at Paolo's behavior in this dispute and say "do we want to run that risk when the time comes?" By and large, the answer will likely be no. So these tactics may well win Paolo a tactical victory, which bully for him because in this case it means backers get their stuff sooner, but it's likely to become a huge strategic debacle for the brand, which hurts those same backers and many more people besides. Now, it could reasonably be inferred that BF simply has them over a huge barrel and without this, there simply won't be a short-term OR a long-term, but we've already seen Paolo admitting that he was warned the entire KS idea was not that great by the CEO and he pressed on. I'm not sure I want to say his judgement in business matters is particularly solid.

All of that said, none of the answers provided by BF have really been helping me sympathize with their position. Yes, they may have paid 400k already, but half of that was reportedly for an extant debt. It really doesn't say "We have the money and POs for Wave 2 ready once we iron out these last details" to my reading. It seems much more like a selective presentation of the truth which, while not shocking, doesn't engender feelings that things are on the up-and-up. I do know that personally I've curtailed most of my spending with BF pending the resolution of this issue (excepting things already planned/ordered). Of course at this point it's closing the stable door now that all the horses are out, but still.

**SeanDrake**

katfude wrote:
From worldofdust.net in regards to dust-tactics.com not working:

Until recently, this website was accessible through several different domain names. One of these, www.dust-tactics.com, is owned by Dust Studios, who have decided to discontinue this domain.

From now on, the best way to access this site is to use the domain www.worldofdust.net. The website content remains unchanged, and will continue to offer support for Dust Tactics, Dust Tactics Battlefield and Dust Warfare, along with our active discussion forum.

We apologise for any disruption or inconvenience.

I thought it was the ebil BF who closed it so that backers could not chase them.

Surely DS would not quietly pull the plug on the site and let BF take the flak

**AlexHolker**

Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

That ceases to be a credible argument when the public has a substantial financial investment in your business. Want to keep your problems private? Stay the feth off of Kickstarter.

**Dawnbringer**

AlexHolker wrote:
Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

That ceases to be a credible argument when the public has a substantial financial investment in your business. Want to keep your problems private? Stay the feth off of Kickstarter.

That holds so long as you only intend to business with just the public in the future. If you want to do business with other businesses in the future it's still a bad idea.

**carboncopy**

Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Would you advocate disgruntled passive-aggressive jabs on a public forum instead?

Since the Kickstarter backers have a large amount of money tied up into the project, it is their business transaction too, and they may be viewed as a "business partner" or "investor", so yes they have a right to know about their business dealings. It would be a different story if backer funding wasn't involved. Unfortunately, since Battlefront has control of the Kickstarter page and pledge manager, to my knowledge there is no other way to inform the backers, except publicly.

**weeble1000**

Yodhrin wrote:
Duncan_Idaho wrote:
Well, going all public with disagreements is generally considered a bad idea in the business-sector.

Erm, aye, but that's a bad thing. Capitalism is supposed to consist of informed participants on all sides, including the customers. Frankly all information about a company and how they do business should be public knowledge unless it directly relates to their IP or their business model is their IP. Whether out of self-interest or genuine concern for backers, Paolo has done them and other BF customers a service, it's a shame a few folk are seemingly much more concerned with business etiquette than the fact BF appear to be in breach of contract and happily screwing their KS backers.

I really can't agree with that. There's a font of very good reasons to control access to information. Not the least of which is privacy concerns.

What we are seeing here is an excellent example of what can go wrong with so-called 'transparency'. From what I can see, Palo is pushing a particular narrative, and has been releasing information that supports this narrative. He is using information to achieve a specific goal. His goal is clearly not transparency for the sake of transparency.

His actions, regardless of whether or not one believes they are 'justified', are causing massive damage to the Dust brand. He's taken the nuclear option and fallout is spreading all over himself, Dust, Dust Studios, Dust Manufacturing, Battlefront... People are already saying that this could be the end of all Dust-related product lines.

I'm not coming down on this thing one way or another. But anyone can see the harm that is being caused.

Again, this is ultimately a Kickstarter problem. As much as Kickstarter has been great for the table top gaming industry, it has also done a great deal of harm.

**carboncopy**

weeble1000 wrote:

What we are seeing here is an excellent example of what can go wrong with so-called 'transparency'. From what I can see, Palo is pushing a particular narrative, and has been releasing information that supports this narrative. He is using information to achieve a specific goal. His goal is clearly not transparency for the sake of transparency.

I'm sure his main goal is to protect his IP and manufacturing business. The main way to do this is to try and protect and secure his customers. The best way to do that at this point is to say "Hey we know you are pissed, and even though our name is on this, and we're responsible for making your products, these Battlefront guys have your money, and we're waiting on them to pay us, so we can make your stuff. Just so you know, it's not us holding things back, take a look for yourself." I'm not a backer, nor have a stake in either side, but even I can see that. Yes it's a tactic, but so is any business decision. If he was completely trying to use "transparency" only for his ends, I think he should have down-played the fact that they went into the deal knowingly and in support of Battlefront to pay off it's debt. As a Kickstarter backer I'd be pissed knowing my "investment" went mostly to bailing Battlefront out of debt, especially if they suspected Battlefront was having money troubles.

weeble1000 wrote:

His actions, regardless of whether or not one believes they are 'justified', are causing massive damage to the Dust brand. He's taken the nuclear option and fallout is spreading all over himself, Dust, Dust Studios, Dust Manufacturing, Battlefront... People are already saying that this could be the end of all Dust-related product lines.

That's all just dramatic conjecture at this point. It's too early to measure the effects of what's going on. Sure it will effect things - it's damage control - but would it be better or worse than the alternatives? Especially when its your name on the product and your name on the kickstarter.