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Zynga Inc (ZNGA) And EA Settles Dispute

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Zynga Inc (NASDAQ:ZNGA) and Electronic Arts Inc. (NASDAQ:EA) have settled various intellectual property claims on each other, according to a court filing. The filing, which was uncovered by AllThingsD.com, said that the dispute has been settled out of court.

The size of the settlement, and if it had monetary value, has not been revealed.

Electronic Arts Inc. (NASDAQ:EA) had initially sued Zynga Inc (NASDAQ:ZNGA) last August, claiming that the firm’s game The Ville was a direct copy of the EA offering The Sims Social. Zynga disputed that claim and counter-sued for unfair and anti-competitive business practices.Today’s settlement came quietly and without aplomb, neither company seems to want much information about it out in the public domain.

Both companies released the same obfuscating statement on the settlement, declaring, “EA and Zynga have resolved their respective claims and have reached a settlement of their litigation in the Northern District of California.”

No details about how the case was settled have been made available, but it means little as Zynga has already begun to shut down The Ville.

Zynga Inc (NASDAQ:ZNGA) chose The Ville as one of the games it would reduce its investment in in a bid to streamline its offerings into the online gaming world. The company shut down eleven of its games and reduced its investment in several others in order to lower its cost base. It is unclear whether the decision it made to reduce spending on The Ville had anything to do with the law suit that Electronic Arts had filed against the company.

The suit highlights several things about the social gaming market, but the lack of information really takes away from any conclusions that could be drawn. One thing that is clear is that the fast moving world of social gaming guarantees that lawsuits like these will be fought over near dying games, and sometimes ones that nobody remembers.

Zynga Inc (NASDAQ:ZNGA)’s The Ville was launched June 2012 and then dropped by the end of the year. Electronic Arts Inc. (NASDAQ:EA) Sims Social was launched in August 2011, and had dropped out of the top 25 Facebook Inc (NASDAQ:FB) games i.e. relevancy, by November 2012. This suit was filed in August.

Even if the Zynga Inc (NASDAQ:ZNGA)’s game was judged as a copy in the settlement, it is unlikely there was much loss of revenue from it release. Both firms seem happy to let this suit disappear.

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