Media outlets devoted to the video game industry are lit up today over a bitter contract dispute unfolding in a Dallas County courtroom. On Friday, following a 12-day trial involving claims of fraud, tortious interference and breach of contract, a jury ordered casual game maker PopCap to pay $4.6 million in damages to former business partner, MumboJumbo.

Writes Gamasutra: The two companies signed a game retail distribution agreement in July 2006, in which Dallas-based MumboJumbo was meant to provide sales and distribution services for PopCap and its games. That deal eventually went sour, with PopCap suing MumboJumbo for payments allegedly owed under the agreement, and MumboJumbo countersuing.

The jury found PopCap liable for fraud, tortious interference, and breach of contract, according to the lawyers for MumboJumbo, which is responsible for games such as Midnight Mysteries: The Edgar Allan Poe Conspiracy and Luxor Adventures.

Through the use of trial testimony and exhibits, MumboJumbo's attorneys from Dallas-based Rose•Walker showed that PopCap committed fraud and tortious interference when it severely damaged a key business relationship between MumboJumbo and a key retailer. Rose•Walker attorneys Marty Rose, Mike Richardson, Ross Cunningham and Bryan Rose used PopCap's own internal e-mail communications to show jurors how PopCap employed a calculated use of false and misleading statements to sour that relationship.

The jury's verdict includes $4.6 million in actual damages, and a separate hearing will be held to decide on the amount of attorneys' fees to add to the damages.

"The law allows you to do plenty of things to be successful in business," says Rose•Walker co-founder Marty Rose. "However, it does not allow you to commit fraud or interfere with a company's business relationships. The jury's verdict is a clear signal that this type of business conduct is not going to be tolerated."

Headquartered in Dallas, Texas, MumboJumbo LLCTM (http://www.mumbojumbo.com) is a worldwide publisher, developer and mass marketer of premium casual games for PCs and game consoles. MumboJumbo games are downloadable at its website as well as key game portals, or purchased at retail through mass merchants, computer retailers and specialty outlets.