The latest chapter in the ongoing legal tussle between Silicon Knights and Epic Games has been written, with the court refusing a motion to dismiss the suit entirely.

In July, Silicon Knights filed suit against Epic, claiming the company provided an incomplete version of the Unreal Engine 3 for Silicon Knights’ upcoming Too Human game, and were also either unwilling or unable to support it properly. Epic followed with a counter-suit in August, saying it had done nothing wrong and that Silicon Knights was simply looking for a way out of paying for the engine they had licensed.

Following the ruling, Epic Vice President Mark Rein said, “[The Judge] put the discovery process in motion, which will allow the lawsuits to move forward. Epic had asked for the entire case to be dismissed. Judge Denver denied this request, which is not unusual. Often these requests are denied. It is important to note that this was not a decision on the merits of Silicon Knights’ claims. We are confident that the evidence will show Silicon Knights breached its license with Epic Games and violated our copyrights and trade secrets.”

Christoper T. Holland, the attorney for Silicon Knights, was equally optimistic about the decision. “We’re a long way from a verdict in this case,” he said in remarks to, “but certainly as a plaintiff we’re pleased that the court has recognized the merit in our claims and we’re happy that we can now proceed as planned with all the claims we brought for discovery and trial.”

Despite the lawsuit and Silicon Knights’ apparent problems, the Unreal Engine 3 has been popular among licensees and used in numerous games including BioShock, Mass Effect, Stranglehold, Gears of Warand Unreal Tournament 3. No trial date has been set.

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