FILED: NEW YORK COUNTY CLERK 11/11/2016 07:09 PM INDEX NO. 651920/2016 NYSCEF DOC. NO. 39 RECEIVED NYSCEF: 11/11/2016 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK, COMMERCIAL DIVISION - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X LESLIE BENZIES, : : Plaintiff, : -against- : : TAKE-TWO INTERACTIVE SOFTWARE, INC., : ROCKSTAR GAMES, INC., ROCKSTAR NORTH : LTD., DAN HOUSER and SAM HOUSER, : : Defendants. : : - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X Index No. 651920/2016 Motion Sequence #002 Hon. Barry R. Ostrager AFFIDAVIT OF LESLIE BENZIES STATE OF CALIFORNIA ) ) SS: COUNTY OF LOS ANGELES ) LESLIE BENZIES, being duly sworn, deposes and says that: 1. I make this affidavit to place before the Court certain documents that are relevant to the Defendants motion to dismiss and to correct various inaccurate factual statements and assumptions contained in Defendants Memorandum in support of their motion. 2. Defendants argue that the 2009 Royalty Plan vests the Allocation Committee and Sam Houser with unfettered discretion with respect to royalty allocations and distributions to the Rockstar Principals. They also argue that my claims for fraud, breach of fiduciary duty and aiding and abetting breach of fiduciary are barred by the applicable statutes of limitations. As I understand it, their argument is that I could easily have discovered the facts I allege constitute fraud simply by reading the Royalty Plan.... Essentially, Defendants claim that had I read the Royalty Plan, I would have discovered that the Defendants retained absolute 1 of 19
and complete discretion to not pay me a single penny in royalties. As I will explain, this is simply not true. 3. While I defer to my attorneys with respect to the applicable law and legal arguments, I believe it is important that I personally respond to Defendants false statements of facts. I Am Not a Sophisticated Investor or Businessman. 4. I would like to begin by acknowledging that I am not sophisticated or particularly knowledgeable when it comes to legal matters. I have no legal training, formal or otherwise. I also do not have a business degree, nor have I taken business courses of any kind. I received no formal education after the age of 18. 5. When I first came to work for the company that would later become defendant Rockstar North, I was a computer programmer. I wrote code. I was what Sam Houser has often described as a creative type who, while skilled when it comes to the mechanics of video games such as writing code, was far less skilled when it came to things such as understanding complicated and lengthy business documents. Accordingly, in trying to understand legal documents, I look to the people I know and trust who have greater business acumen than I do. In this case, Sam Houser represented the Rockstar Principals, a group of three that included Sam, his brother Dan, and me. As between the Rockstar Principals, I was responsible for delivering great games, and Sam was responsible for protecting our collective business interests. Sam repeatedly assured me that he would do so. He would write things to me like his August 13, 2008 email, which provided: You know I will do everything in my power to deliver the right situation for everyone. I won t stop until we have it, and his December 12, 2008 email, which provided: Partners for real this time!!! I think this is incredible. We've spoken about it for so 2 2 of 19
long, but now we've made it happen. Awesome!!! True family. Sam took the lead and managed all negotiations with Take-Two, updating me periodically, but not regularly. We the Rockstar Principals were also represented jointly by the same counsel, Paul, Weiss, Rifkind, Wharton & Garrison, LLP ( Paul Weiss ). However, I had almost no contact with the lawyer from the firm. I recall only meeting him once, while I was visiting Rockstar s New York office, and we spoke for approximately 30 minutes. Sam repeatedly referred to them as the best. I note that they are identified as our attorneys in the agreements we signed. My Wealth Should Not Be Relevant To Whether I Have Legal Rights. 6. In reviewing Defendants motion to dismiss, I see that they attempt to portray me as excessively wealthy, well-paid and greedy. I readily acknowledge that I am wealthy as a result of my hard work and good fortune and, until recently, was well compensated. As to the suggestion that I am greedy, all I am seeking is to enforce rights that I believe I have. Ultimately, this Court will determine whether I am entitled to what I am seeking. In that respect, I do not believe my wealth should be relevant to this Court s determination of my rights. The Absence of the Word Discretion In The Relevant Provisions of the 2009 Royalty Plan. 7. My understanding is that Defendants have argued that determinations under the 2009 Royalty Plan with respect to royalty allocations and distributions to the three Rockstar Principals were within the sole and absolute discretion of the Allocation Committee and Sam Houser, and that I could actually get nothing (which is what eventually happened). If that was the intent of the drafters of the 2009 Royalty Plan (I would note that I did not participate in any way, shape or form in the drafting process), then I would have expected to be told that by Sam, or by our joint attorneys from Paul Weiss, or by a summary of terms that would clearly have 3 3 of 19
called out that I really had no right to continued royalties. I did not receive any such information. In so much as Defendants claim that the 2009 Royalty Plan gives them complete and absolute discretion and that I cannot object to distributions made or not made, I would have certainly expected that Sam, Paul Weiss, or a summary of terms would have clearly said so. 8. I was never told by Sam or anyone, including counsel, that Sam could end up withholding royalty payments from me. Had I been told at the time I signed, I would have been shocked and would not have signed any of the documents I signed that day. I would have returned immediately to Sam and asked what was going on. He never told me that our interests were anything but the same, that we as the Rockstar Principals were united in our positions and goals, and that I could trust him to deliver on his promises to obtain for the three of us the best possible agreement, with each of us equal. It would not have occurred to me to question him. I have reviewed the 2009 Royalty Plan a number of times since this case started and I am certain that the words and/or phrases discretion, sole discretion, absolute discretion or any similar formulation containing the word discretion do not appear in any relevant provision of the Plan. While the word discretion is used in one section of the 2009 Royalty Plan, it was not used in any provision that Defendants are relying on to deprive me of royalties. 9. I also note that the 2009 Royalty Plan does not contain headings or bold typeface of any kind that would have alerted me, or any other reader, that royalty distributions to Rockstar Principals would be subject to the type of discretion Defendants now claim for themselves. I find the absence of any headings or prominent font using the word discretion interesting. 10. When I signed my first employment agreement with Rockstar North in 2002, I was eligible to participate in the 2002 Royalty Plan. As Defendants did not provide the Court with a copy of the 2002 Royalty Plan, I have attached a copy as Exhibit 1. 4 4 of 19
11. In the 2002 Royalty Plan, the drafters (again, I did not participate in the drafting of the Plan) used the phrase at their sole and absolute discretion in a provision concerning royalty allocations and distributions. (See Ex. 1, Sec. 3(c)). I was part of this Plan and another plan titled the 2006 Royalty Plan. 12. The language sole and absolute discretion contained in the 2002 Royalty Plan, however, was omitted from both the 2006 and 2009 Royalty Plans. 13. Under the 2006 Royalty Plan, I received a royalty based on profits from games sold and other factors. There was no discretion that I was aware of with respect to that royalty amount. I would not have agreed to the 2009 Royalty Plan had I known that it was possible for me to receive no royalties under that plan. 14. So that there is no confusion on this point, I want to be clear that at no time during my active employment at Rockstar North did any Defendant ever inform me in words or in substance that: a) It was their view that under the 2009 Royalty Plan the distribution of royalty payments to Rockstar Principals was within the sole and absolute discretion of the Allocation Committee and Sam Houser. b) It was their view that under the 2009 Royalty Plan, Rockstar North could allocate and distribute zero dollars to me for the entirety of my employment with the company. c) It was their view that the Allocation Committee and Sam Houser could discriminate between and among the Rockstar Principals with respect to the payment of royalties. d) At no time did the Paul Weiss law firm, who Defendants, particularly Sam, led me to believe were representing me and my interests in connection with the negotiations of the 2009 Royalty Plan, (as well as) my Amended and Restated Employment Agreement and the related agreements, ever advise me that I essentially had no rights under the 2009 Royalty Plan. 15. In fact, having reviewed certain pertinent emails from the time leading up to the execution of the 2009 Royalty Plan, all emails indicate that the Defendants went out of their way 5 5 of 19
to not mention that they felt that they could strip me of royalties at their discretion. The November 11, 2008 email mentioned by Mr. Levander in his affirmation (attached thereto as Exhibit D) includes reference to a Final Term Sheet Summary of the Deal. That document is attached to this affirmation as Exhibit 2. In that document, there is no mention that Sam Houser or the Allocation Committee has discretion with regard to paying me royalties. Also, on December 3, 2008 days before I was asked to execute the 800-page suite of agreements that included the 2009 Royalty Plan Rowan Hajaj sent a summary of the suite of agreements that again did not provide that Sam Houser or the Allocation Committee had discretion with regard to paying me royalties, or that I could potentially receive nothing. In fact, that document provided: Additionally, the Principals and T2 are parties to the 2009 Royalty Plan, which provides for ongoing payments to Rockstar Employees (including the Principals) and certain others based on the profitability of R* Games. That sentence seems to indicate the opposite of discretion to me the Rockstar Principals were to receive ongoing payments based on the profitability of R* Games. The games that I worked incredibly hard to produce were extraordinarily profitable (to the tune of billions of dollars); the notion that I could be denied ongoing payments never was brought to my attention. A true and correct copy of the December 3, 2008 Summary of Agreements is attached hereto as Exhibit 3. 16. If Sam and the rest of the Defendants now say that Sam or others had absolute discretion to give me something or nothing, or that Sam or others could give me nothing while the other Rockstar Principals received full shares, or if Paul Weiss were to say so, this would be totally contrary to what Sam and the other Defendants were leading me to believe in the lead-up to my signature on the 2009 Royalty Plan and the rest of the documents I signed that day. 6 6 of 19
17. It was a relief to have Sam s support, advocacy, and friendship during the negotiating process. During this time, I was deeply involved in the release of the video game Grand Theft Auto IV: the Lost and the Damned. There was a great deal of pressure to complete and ship the game, and I was working 80-hour weeks at that time (work weeks become very long and intense as game delivery draws to a close, with multiple internal and external deadlines). The Defendants knew my focus was on delivery of the game. I could not possibly have reviewed and absorbed all of the documents, no matter how long in advance they were provided, and I certainly had no time to review them during the hour or so that Mr. Hajaj waited while I signed in December. Trusting Sam was very natural for me, and I depended on him and his assurances completely in signing. It reflected our division of responsibility: I would tend to the creative, while he would tend to the business, and there are dozens of email and written communications that reflect that. Royalty Equality Was An Important Inducement To My Agreeing To Enter Into A New Employment Agreement With Rockstar North. 18. I believe it is important for the Court to understand that my right to receive royalty payments under the 2009 Royalty Plan was an important part of my total compensation package and a material inducement to my deciding to continue my employment with Rockstar North. Under my Employment Agreement dated as of February 1, 2006, I was employed for a three year term. If I did not enter into a new agreement with the company, I would have been free to terminate my employment effective February, 2009. 19. In light of the success of the GTA franchise, the enormous revenue it generated for Rockstar North and Take-Two, and what I believed to be my substantial contribution to that success in late 2008 early 2009, I was looking for a significant increase in my total compensation 7 7 of 19
package to remain with Rockstar North. Sam said the three of us were due this increase, and that he was the one to obtain it from Take-Two, which he said he would do. He repeatedly reassured me in-person and by e-mail that this was exactly what was going on. I sought an increase in my base compensation as well as in my participation in royalty distributions. While the increase in base compensation the company proposed for my new employment agreement was certainly substantial, without more it would not have been sufficient for me to agree to enter into a new employment agreement (and the related agreements) in 2009. The additional compensation I required, and was led to believe I would receive, under the 2009 Royalty Plan was a material inducement to my entering into the Amended and Restated Employment Agreement dated as of December 12, 2008, the 2009 Royalty Plan, and the other related documents. My Continuing As President Of Rockstar North Was An Important Inducement To My Agreeing To Enter Into The New Employment Agreement With Rockstar North. 20. Compensation was not the only issue of importance to me in negotiating my new agreements with Rockstar North and Take-Two. My continuation as President of Rockstar North was certainly a condition to my remaining with the company. The position gave me a degree of authority and control that I felt was essential to the work we were doing, to what I hoped to accomplish, and to the profitability of the company. The continuation of my role and duties as President of Rockstar North was reflected in paragraph 2(a) of my Amended and Restated Employment Agreement. Defendants would ultimately strip me of my duties and responsibilities as President by barring me from Rockstar North s office upon my attempt to return from sabbatical. 8 8 of 19
Royalty Equality Was A Continuing Inducement To My Agreeing To Enter Into An Amended and Restated Employment Agreement With Rockstar North. 21. I signed a third Amended and Restated Employment Agreement on September 12, 2012. The September 12, 2012 Amended and Restated Employment Agreement includes the following language: This Agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto... with respect to the employment of the Employee by the Employer and, together with the Royalty Plan [and other agreements], contains all of the covenants and agreements between the parties with respect to such employment in any manner whatsoever.... A true and correct copy of the September 12, 2012 Amended and Restated Employment Agreement is attached hereto as Exhibit 4. When I executed the September 12, 2012 Amended and Restated Employment Agreement, I agreed to stay on at Rockstar for another six (6) years (through 2018). My understanding at that time was that I would continue to receive royalties equal to Sam and Dan. For the previous four years (under the 2008 Employment Agreement and 2009 Royalty Plan), it appears that I did receive what I expected and what I was promised equal royalty disbursements to Sam, Dan and Leslie. The 2012 Amended and Restated Employment Agreement includes the following language: the Employee became and remains entitled to receive certain royalties under the 2009 Royalty Plan. I would not have signed the 2012 Employment Agreement and agreed to a new long-term obligation with Defendants if I knew that Sam or an Allocation Committee could or would just cut off my royalties, or deny me my equal share. Since signing my 2008 Employment Agreement and before signing the 2012 Amended and Restated Employment Agreement, I continued to receive Sam s forceful assurances of trust, family, and a bright and lucrative future: 9 9 of 19
a) Email, Sunday, July 17, 2011: As ever, I feel so fortunate to have you as a friend and a partner. I think we can go anywhere together. And we should/must! Fingers crossed.. Love Sam. b) Email, Friday, July 29, 2011: Amongst all this, there s so little so few you can rely on, and yet we all have this wonderful thing together that (I think) gets stronger and better (despite the challenges/set-backs). Whatever happens, let s please all stick together and keep making the best possible work we can. c) Email, Monday, August 8, 2011: So grateful to have you as my partner. d) Email, Monday August 15, 201l: Let s fucking dominate! Let s go for it harder than ever. We have something SO special and SO rare to protect and grow. e) Email, Friday, August 19, 2011: Amazing opportunity. But, only exceeded IF we attack like maniacs. OUR original way IS the ONLY way. Total sacrifice and commitment. TOTAL domination to get us to where we really want/need to be for the long haul. Together-forever right??? Fingers crossed. Love, Sam. f) Email, Saturday, August 20, 2011: Together forever is the only way. There s so much nonsense out there that to have something real that we can truly rely on in all ways is a really magical thing. So unique in this world of everyone trying (and failing) to put one over on the next person. I know I m going on about it a lot right now not sure why I just really feel it! Its [sic] something to celebrate and cherish. Love from SW 14, Sam. My Elevation To The Status Of Rockstar Principal Was Important As I Believed It Provided Me With Essential Protections. 22. In addition to agreeing that I would continue as President of Rockstar North, with the execution of the 2009 Royalty Plan, I became a Rockstar Principal. This was a very elite group within the Rockstar Corporate family. In all of the time that Take-Two and Rockstar Games have been doing business with one another, and of the thousands of employees who have worked for Rockstar Games over the years, to my knowledge only three employees other than me have obtained the status of Rockstar Principal; Sam Houser (co-founder and President, Rockstar Games), Dan Houser (co-founder and Vice President of Creative, Rockstar Games), and Terry Donovan (Chief Executive Officer, Rockstar Games). 10 10 of 19
23. I took great pride and comfort in the fact that I was being elevated to the exclusive group of Rockstar Principals. The fact that Sam Houser, Dan Houser and I were defined collectively in the very first paragraph of the 2009 Royalty Plan as Rockstar Principals denoted to me that we would be treated equally, including with respect to royalties. Otherwise, why would we be grouped together? To me, my inclusion in this elite group was consistent with Sam Houser s repeated email, text and verbal assurances that we were partners and that he would protect my interests. After all, I was now being made a member of this elite group. And, Sam, Dan and I together formed Another Game Company LLC as part of this larger transaction, with the knowledge and blessing of all Defendants -- an entity that was intended to protect our rights, and my understanding based on written communications from Rockstar and Sam was that we were equal partners in that as well. This was all consistent with what Sam told me his negotiating strategy with Take-Two would be, which was to ensure that we the Rockstar Principals would have security within the companies as a single negotiating unit. I understand that Defendants now take the position that I was mistaken in my belief as to royalty equality, but if Defendants now deny what Sam repeatedly promised me, that does not mean that it was unreasonable for me to believe Sam, and take security from the fact that at no point was I warned that we were not equal, by Sam or by our joint attorneys. When I signed, I believe that Sam had honored his commitment to me. 24. Because the 2009 Royalty Plan does not guaranty that any Rockstar Principal would receive a specific dollar amount in royalties, it was all the more important to me that I had become a Rockstar Principal as I reasonably expected that at a minimum I would receive the same royalties as the other Rockstar Principals. I relied on the reasonable expectation that Sam and Dan Houser, as the co-founders of the company, would treat themselves fairly when it came 11 11 of 19
to Royalty distributions and, in turn, I would necessarily have to be treated fairly because I would receive whatever they did. Royalty Equality Was A Fact. 25. Although Defendants deny the existence of royalty equality, it is my understanding that for every year from the execution of the 2009 Royalty Plan through May, 2014, there was in fact royalty equality among the three Rockstar Principals. During this five year period, each of us the Rockstar Principals received identical royalty payments. While I am not sure of the legal significance of this fact (which I do not believe Defendants dispute), to me it reinforced, and continues to reinforce, my belief that there was royalty equality under the 2009 Royalty Plan. Equal distributions over a six year period from 2009 to 2014 certainly is evidence that Defendants shared my belief that each of the Rockstar Principals was entitled to receive equal royalty distributions. I Am Not Aware That The Allocation Committee Ever Met Or Utilized Any Formula To Compute Distributions To The Rockstar Principals. 26. My understanding is that Defendants have argued that decisions of the Allocation Committee are final and binding on the three Rockstar Principals and that they seek to shield their decisions as to my royalty distributions from judicial scrutiny. However, during the years that I was president of Rockstar North (and while the 2009 Royalty Agreement was in effect), I was not aware that the Allocation Committee referenced in the Plan had ever met. Those words were never used by Sam or anyone else in my presence, and I note that the term Allocation Committee is not even a way of speaking that I associate with Sam. 27. Nor was I aware of any formula or methodology that was ever used by the Allocation Committee (if it actually met) to determine the distributions to the Rockstar 12 12 of 19
Principals. While I cannot say with absolute certainty (without the benefit of discovery of Rockstar North and Take-Two by my attorneys) that there were no such meetings, formulae or methodologies, I can say that as the President of Rockstar North and a Rockstar Principal I would have expected that any such information would have been shared with me. To my recollection, it was not. At most, I remember there were informal conversations with Sam Houser regarding Rockstar North employees (but not Rockstar Principals), including regarding their respective bonuses and royalty allocations. We together often discussed how royalties would be distributed to other employees, and as we did so there was no talk of an Allocation Committee. Sam and I made the decisions. 28. The fact that each year for five years each Rockstar Principal received equal royalty payments suggests that if there was an Allocation Committee, and if it did meet, the simple formula they had to have utilized was to take the royalties allocated to the Rockstar Principals and divide that amount by three [i.e., X Dollars (the amount allocated for the Rockstar Principals) divided by 3 (the number of Rockstar Principals) equals Y (the distribution to each Rockstar Principal)]. That is the only formula (to the extent you can even call it a formula) that I was aware of during the period from 2009 through the date of the termination of my employment. Sam Houser s Assurances Were An Integral Inducement To My Agreeing To Enter Into A New Employment Agreement With Rockstar North. 29. Defendants argue that my Complaint does not contain specific misrepresentations made by Sam Houser concerning royalties. In so arguing, it appears that the Defendants cannot see the forest for the trees. As I specifically allege in my Complaint, Sam Houser made repeated representations to me (in person, by telephone, by text message and by e-mail) designed to have me entrust him with the negotiation of the new employment agreements and royalty plan. These 13 13 of 19
representations are specifically alleged throughout my Complaint, and I repeat this critical point: If Sam had not repeatedly induced my trust and insisted I trust him, I would never have signed any of the documents. I signed them because I was aware he was my advocate, that he would be unfailingly loyal to me just as he repeatedly promised to be, and I had no reason whatsoever to doubt that promises made would be kept. Based on Sam Houser s assurances and representations, I did not participate in the negotiation of the 2009 suite of agreements that included the 2009 Royalty Plan. Indeed, Defendants own exhibits on this motion support, if not prove, this fact. 30. Exhibit D to the affirmation of Mr. Levander reflects that it was Sam Houser who dealt directly with Rockstar Games Rowan Hajaj (apparently representing Take-Two in the process as well), and Sam in turn dealt with me (and his brother Dan). If I had been in the negotiation loop, then it would have made sense for Mr. Hajaj to have sent his November 11, 2008 e-mail with the draft documents directly to me. He did not. Instead, Mr. Hajaj sent the e- mail and the attached draft documents to Sam Houser with a copy to Jennifer Kolbe (another Rockstar Games executive who has an extremely close relationship with Sam, and who acts as his right hand ). Exhibit D is consistent with, and supports, the allegations contained in my Complaint concerning the respective roles that Sam Houser and I had with respect to the negotiation of the 2009 Royalty Plan and the related agreements. To briefly summarize, Sam undertook the role of representing my interests in the negotiations with Rockstar North and Take-Two. I am confident that discovery of Defendants will reveal additional evidence establishing that Sam Houser assumed responsibility for negotiating on my behalf and that he, and not I, worked directly with the relevant parties. 14 14 of 19
31. Having gained my trust, Sam Houser continued to make assurances that were intended to put me at ease. His repeated statements that we were partners gave me comfort that he was looking after my interests. I have always understood, as a layman, that partners owe certain duties to one another. One of those duties would be that you cannot act in a way that disadvantages your other partners for your own benefit. Yet, if Defendants are correct in their interpretation of the 2009 Royalty Plan, then Sam Houser violated that duty. He represented my interests by negotiating an agreement that, according to Defendants, gives him and his brother Dan effective control over the allocation and distribution of royalties to me. If Defendants are correct, then Sam Houser represented my interests by negotiating an agreement which gave me absolutely no right to a single dollar in royalties. While I am not a lawyer or a sophisticated businessman, my understanding is that what Sam Houser has done is inconsistent with the obligations of one partner to another. I would repeat that at no time did Sam Houser or any defendant ever call to my attention that they believed the document they were asking me to sign gave me no royalty rights of any kind or could be interpreted that way. If I am being represented by capable professionals, plus a dear and close friend, as I was by Sam, plus attorneys, I would expect them to be candid, forthright and detailed if I was to be at this type of huge disadvantage. 32. I understood Sam s use of the word partners and Rockstar Principal to mean we would be treated equally and fairly, which to me meant that we would receive equal treatment under the Royalty Plan. 33. Consistent with this belief, to the extent that Defendants are correct in their interpretation of the 2009 Royalty Plan, then I would have expected that as my partner, Sam Houser would exercise his discretion in a way that did not advantage him at my expense. 15 15 of 19
Defendants Unsubstantiated Statements About My Performance. could pay me zero dollars in royalties for any or no reason whatsoever and I would have no right 16 34. Defendants Memorandum of Law contains a number of unsubstantiated statements of purported facts concerning my performance at Rockstar North, including, but not limited to, the following: a) That my poor performance during the development of Grand Theft Auto V ( GTA V ) led to significant production problems and as a result I was encouraged to go on sabbatical. (Def. Mem. at p. 1). b) GTA was produced despite Benzies (Def. Mem. at p. 2). c) [M]any of the delays related to its GTA Online feature were because of [Benzie ] poor performance. (Def. Mem. at p. 2). While I understand that in opposing this motion I am not required to respond to unsubstantiated allegations of fact made by Defendants counsel, I cannot permit these false charges to stand. Contrary to the assertions of counsel, who has no first-hand knowledge of the facts concerning my performance, I can unequivocally state that at no time prior to my taking sabbatical did Defendants complain to me about my performance. At no time prior to my taking sabbatical did any Defendant provide me with any notice, written or otherwise, that I had violated my duties and obligations under my various employment agreements or otherwise failed to perform my duties as President of Rockstar North. 35. I believe that at all times I fully and more than capably performed all of my duties as President of Rockstar North. And, as I allege in my Complaint, my work played an important role in the success of the GTA franchise. My Right To Legal Redress 36. Under Defendants interpretation of the 2009 Royalty Plan, for all practical purposes I had no rights. According to Defendants, the Allocation Committee and Sam Houser 16 of 19
to challenge their decision. Moreover, Defendants state that I have no legal claims of any kind and no legal redress. To the extent that my knowing consent is relevant, the Court should know that I never intended to enter into, and did not knowingly enter into, a royalty agreement that gave me no tangible benefits or rights and no legal recourse. I did not do so. 37. Under Defendants interpretation of what they describe as a no-contest provision, I have no right to challenge in this or any other court any royalty determination, even if that determination was made in violation of the terms of the 2009 Royalty Plan and/or applicable New York law. Under Defendants interpretation, even if the Allocation Committee never met, even if they exercised discretion they didn t have or exercised their discretion in violation of New York law, I would still be barred from seeking redress in this or any Court. This was not something I ever agreed to and I respectfully submit this Court should not and cannot close its doors to my attempt to have my rights determined by an impartial third party. Defendants Selective Production Of Documents To The Court. 38. Defendants direct the Court s attention to an e-mail that Sam Houser purportedly sent to me on November 11, 2008 in which various drafts of documents were attached. (See Exhibit D to Mr. Levander s Affirmation). Initially, I would note that Exhibit D is incomplete, as it does not include 12 of the 13 documents referenced as attachments. Among the attachments that Defendants failed to provide is the Final Term Sheet referenced in Mr. Hajaj s e-mail to Mr. Houser. The Final Term Sheet, referenced in Paragraph 15 of this affirmation (and attached as Exhibit 2), does not disclose that I could be denied royalties, or that Sam or the Allocation Committee had discretion to do the same. 39. I believe it is noteworthy that Defendants do not claim that they provided me with advance copies of all 800 pages of documents I would be asked to execute in final form in 17 17 of 19
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