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'Star Citizen' suffers crowdfunding blow from LA district attorney

Cloud Imperium Games, creator of the long-in-development spacefaring adventure game Star Citizen, has issued a substantial refund to one of its backers after attracting the attention of the district attorney of Los Angeles, potentially setting a precedent for future cases regarding delivery of crowdfunded products.

According to a lengthy forum post detailing the ordeal, Star Citizen backer “Streetroller” was flatly denied multiple requests for a refund after arguing that the still-in-development Star Citizen did not reach a state of completion within a time frame specified by its creators.

Cloud Imperium Games quickly changed its tune after Streetroller contacted the district attorney of Los Angeles, the Federal Trade Commission, and the Los Angeles Department of Consumer and Business Affairs in response. Without acknowledging any wrongdoing on its part, Cloud Imperium Games subsequently issued a full refund of Streetroller’s $3,000 pledge.

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Announced in 2011, Star Citizen is an ambitious, multifaceted game for PC platforms that promises a mixture of space exploration, interstellar combat, and first-person shooter sequences. A story-driven campaign titled Squadron 42 is also being developed alongside the game’s open-universe component. Cloud Imperium Games kicked off an ongoing crowdfunding campaign for Star Citizen in 2012, earning a total of $117 million in backer funding to date.

Many devoted fans of Star Citizen director Chris Roberts’ previous work with the Wing Commander series pledged thousands of dollars to help make his latest project become a reality. After years of development, however, Star Citizen remains in a playable but functionally bare alpha state.

Frustrated with Star Citizen‘s lack of development progress, backer Streetroller noticed that Cloud Imperium Games had quietly updated its user terms of service in order to head off refund requests.

“You agree that any unearned portion of your Pledge shall not be refundable until and unless RSI has failed to deliver the relevant pledge items and/or the Game to you within eighteen (18) months after the estimated delivery date,” a previous version of the company’s TOS states.

The statement was later amended to read “You agree that any unearned portion of your Pledge shall not be refundable until and unless RSI has ceased development and failed to deliver the relevant pledge items and/or the Game to you.”

Noting the TOS discrepancy and claiming that Star Citizen “remains unfulfilled and no longer constitutes the product I originally purchased,” Streetroller issued his first request to Cloud Imperium Games for a refund, which was denied. It was only after submitting complaints to multiple local and federal consumer protection agencies that Streetroller received a full refund.

“Put simply, ‘takebacks’ are not compatible with the whole concept of crowdfunding since it is simply not fair to the fundraising backers who join our community every month,” Cloud Imperium Games co-founder Ortwin Freyermuth stated in response.

“Nonetheless, having review complainant’s interactions with our customer service agents, we have determined that it is also in our interest to terminate his participation in our fundraising community. We are therefore agreeing to close complainant’s account permanently and we will issue a refund of his pledge promptly.”