A Kickstarter campaign has been ordered by a Seattle court to pay more than $54,000 for unfulfilled backer rewards.
Altius Management, who launched a Kickstarter for Asylum Playing Cards, failed to appear at the hearing and the judgment was rendered by default.
The suit was filed in 2014 by Washington backers of the Kickstarter who failed to receive their rewards. Altius Management had reportedly cut off communication with backers in 2013. They had raised $25,146 after asking for $15,000, with rewards like card decks and art prints promised to backers.
The total awarded to the 31 backers who filed the suit is $668, while the rest of the money will go to the state and court fees.
Altius Management has begun shipping out backer rewards, but it’s probably too late. The court order is dated July 22. This is the first time that a crowdfunding failure has been prosecuted in the United States.
Of course, it’s not the first time a crowdfunding campaign has failed. And it’s not even the most high-profile failure. Since Kickstarter launched in 2009, it’s been the home of many campaigns for video games, board games, card games, and other geek hobby products. Some people treat backing a Kickstarter like gambling on an investment, but this decision by the courts sets a precedent for treating it like an official transaction.
That’s certainly going to affect how carefully businesses plan their Kickstarters. (Factor in those shipping costs, people!)
Kickstarter’s terms of use states, “When a project is successfully funded, the creator must complete the project and fulfill each reward. Once a creator has done so, they’ve satisfied their obligation to their backers.”
“Washington state will not tolerate crowdfunding theft,” said Attorney General Bob Ferguson in July, when the judgment was passed. “If you accept money from consumers, and don’t follow through on your obligations, my office will hold you accountable.”
Companies like Double Fine Productions turned to Kickstarter to fund the point-and-click adventure game Broken Age, which was successfully released in two parts. Failbetter Games’ Sunless Sea came from a successful Kickstarter, as did The Deer God from Crescent Moon Games.
On the other hand, big names have also failed on Kickstarter, in big ways. Game developer Peter Molyneux and his company 22cans raised £500,000 for a game called Godus in 2012. It still hasn’t been fully realized and delivered to backers, though it’s in Early Access on Steam with a lot of negative reviews.
Preparing a Kickstarter campaign takes a lot of work. Companies like Failbetter Games have done extensive breakdowns of how they conducted their Kickstarters. Plenty of websites have put together tips and tricks for conducting a successful campaign.
