1033-00004 · Redstone Gaming Corp · Closing

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

MATTER CLOSING MEMORANDUM

This memorandum is protected by the attorney-client privilege and the attorney work-product doctrine. It has been prepared exclusively for internal use by Calderwood & Harkness LLP attorneys assigned to Matter No. 1033-00004. This memorandum and its contents should not be disclosed to any person outside the firm without the prior written consent of the Responsible Partner. Any inadvertent disclosure does not constitute a waiver of any applicable privilege.

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I. EXECUTIVE SUMMARY

The purpose of this memorandum is to document the successful resolution of Matter No. 1033-00004 and to recommend the formal closure of the file in accordance with Calderwood & Harkness LLP's standard matter management procedures.

On October 22, 2024, the Honorable Rebecca W. Langford of the United States District Court for the District of Nevada granted Redstone Gaming Corp.'s Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107 in the matter styled Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL. The Court's order dismissed the case with prejudice, thereby fully and finally extinguishing all claims asserted by Plaintiff Luminos Interactive LLC ("Luminos") against our client Redstone Gaming Corp. ("Redstone" or the "Client").

Luminos had sought actual damages in the amount of $28.5 million based on an apportioned-profits theory, injunctive relief ordering the removal of allegedly infringing visual assets from Redstone's flagship title Ironclad Dominion, statutory damages in the alternative, and recovery of attorney's fees and costs. Each of these claims has now been dismissed with prejudice, and the judgment carries res judicata effect precluding any future relitigation of the same claims between the parties.

Redstone's net out-of-pocket cost for the defense of this action was limited to $5,000, representing the per-claim deductible under Pinnacle Mutual Insurance Co. Policy No. PML-IP-2023-08841. Total defense costs incurred by the firm and third-party vendors amounted to $1,657,750, the entirety of which (above the deductible) was covered by Pinnacle Mutual under the intellectual property litigation sub-limit of $15 million per occurrence (Claim No. PML-CLM-2024-3392). At no point during the litigation did defense costs approach the policy sub-limit, and Pinnacle Mutual has made timely reimbursements on all invoices submitted through the claims process.

As of the date of this memorandum, no notice of appeal has been filed by Luminos or its counsel, Hargrove, Tanaka & Whitmore LLP. The appeal deadline under Federal Rule of Appellate Procedure 4(a)(1)(A) is November 21, 2024 (thirty days from entry of judgment). No post-judgment motions under Rule 59 or Rule 60 of the Federal Rules of Civil Procedure have been filed that would toll the appeal period. Additional analysis of the appeal deadline is set forth in Section VII below.

Based on the foregoing, I recommend the following closing actions: (1) sending a formal outcome letter to Priya Venkatesh, General Counsel of Redstone Gaming Corp., confirming the dismissal with prejudice and summarizing the favorable result; (2) notifying Franklin Teague, Claims Adjuster at Pinnacle Mutual Insurance Co., of the final disposition and providing final defense cost figures to close Claim No. PML-CLM-2024-3392; (3) notifying local Nevada counsel, Patricia Thorngate of Thorngate & Associates, PC, of the matter closure; (4) confirming final invoicing from all third-party vendors; (5) continuing to monitor the docket through the November 21, 2024 appeal deadline; and (6) upon expiration of the appeal period without the filing of a notice of appeal, formally closing Matter No. 1033-00004 in the firm's matter management system and generating final billing reconciliation.

This memorandum sets forth in detail the parties and counsel involved, the claims and defenses at issue, the full procedural history of the litigation, a summary of the Court's ruling, a financial summary of all defense costs incurred, analysis of appeal deadlines, document retention protocols, and recommended next steps for file closure.

II. PARTIES AND COUNSEL

A. Defendant — Redstone Gaming Corp.

Redstone Gaming Corp. ("Redstone") is a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol RDST. Redstone is one of the leading interactive entertainment companies in the United States, specializing in the development, publishing, and live operation of multiplayer online gaming titles across console and personal computer platforms.

Redstone's corporate headquarters are located at 4100 Obsidian Tower Boulevard, Suite 2200, Las Vegas, Nevada 89109. Its registered agent for service of process in the State of Delaware is Capitol Registered Agents, Inc., located at 1209 Orange Street, Wilmington, Delaware 19801. Redstone's Employer Identification Number (EIN) is 88-3421076.

Redstone is led by Chief Executive Officer Marcus Hale, who has served in that capacity since the company's founding in 2017. The company's General Counsel is Priya Venkatesh, who served as the primary client contact throughout this engagement and authorized all material litigation strategy decisions on behalf of the Client.

As of fiscal year 2023, Redstone reported annual revenue of approximately $1.87 billion. At the time of the commencement of this litigation in April 2024, Redstone had an approximate market capitalization of $6.4 billion and employed approximately 4,200 individuals across its domestic and international studio operations.

Two Redstone personnel were centrally involved in the defense of this matter:

• Jordan Kessler, Vice President of Creative Development, who oversaw the creative direction of Ironclad Dominion from its inception in early 2020 through its commercial release in November 2022. Mr. Kessler provided critical testimony regarding the independent development timeline and the conceptual origins of the game's visual design language.

• Seo-Yeon Park, Lead Character Artist on Ironclad Dominion, who was directly responsible for the creation of the character armor designs and environmental textures challenged by Luminos. Ms. Park's testimony, supported by the version-control history in the ironclad-main Git repository, demonstrated that the challenged assets were independently conceived and executed without reference to Shardfall Chronicles.

B. Plaintiff — Luminos Interactive LLC

Luminos Interactive LLC ("Luminos") is a Texas limited liability company engaged in the development and self-publishing of independent video game titles. Luminos's principal office is located at 802 Brazos Creek Lane, Suite 5, Austin, Texas 78701. Its registered agent for service of process in the State of Texas is Texas Statutory Agents LLC, located at 1601 Rio Grande Street, Austin, Texas 78701.

Luminos was founded by Tobias Crane, who serves as the Managing Member and is responsible for all business and operational decisions. Elara Whitfield serves as Art Director and Co-Founder, and was the primary creator of the visual assets at the center of this dispute. Luminos's Employer Identification Number (EIN) is 84-5093218.

Luminos is a small independent studio. For fiscal year 2023, the company reported revenue of approximately $2.1 million and maintained a headcount of approximately 14 employees. The product at issue in this litigation was Shardfall Chronicles, an indie single-player fantasy role-playing game released on March 22, 2021. As of the filing of the complaint, Shardfall Chronicles had sold approximately 185,000 lifetime units at a manufacturer's suggested retail price (MSRP) of $24.99 per unit, generating estimated gross revenue of approximately $4.62 million since launch.

C. Defense Counsel

Lead Counsel — Calderwood & Harkness LLP

Calderwood & Harkness LLP served as lead defense counsel for Redstone Gaming Corp. throughout this matter. The firm's offices are located at 600 South Grand Avenue, Suite 4400, Los Angeles, California 90071. The following attorneys were assigned to the matter:

• Catherine Bloom — Responsible Partner, intellectual Property. Ms. Bloom provided strategic oversight throughout the litigation, participated in key depositions, supervised the summary judgment briefing, and presented oral argument before the Court on October 15, 2024.

• Alan Ngo — Billing Partner, intellectual Property. Mr. Ngo managed all billing and financial aspects of the engagement, coordinated with Pinnacle Mutual Insurance Co. on coverage matters, and provided substantive input on the fair-use and independent-creation defenses.

• Omar Siddiqui — Lead Associate, intellectual Property. Mr. Siddiqui served as the day-to-day lead for the litigation team, managing discovery, drafting the summary judgment motion and supporting briefs, coordinating with expert witnesses and forensic consultants, and overseeing all document production.

• Christy Bauer — Working Associate, intellectual Property. Ms. Bauer assisted with discovery responses, deposition preparation, document review, and research and drafting support throughout the litigation.

Local Nevada Counsel — Thorngate & Associates, PC

Thorngate & Associates, PC served as local counsel in the District of Nevada. The firm's offices are located at 300 South Fourth Street, Suite 1100, Las Vegas, Nevada 89101. The lead attorney assigned from the firm was:

• Patricia Thorngate — Lead Attorney. Ms. Thorngate handled all local procedural requirements, attended hearings and conferences before the Court and the Magistrate Judge, and coordinated logistics for depositions conducted in Las Vegas.

D. Plaintiff's Counsel

Luminos Interactive LLC was represented throughout this matter by Hargrove, Tanaka & Whitmore LLP, a litigation firm with offices at 1400 Congress Avenue, Suite 900, Austin, Texas 78701. The following attorneys appeared on behalf of Luminos:

• Daniel Hargrove — Lead Attorney and Named Partner. Mr. Hargrove served as lead counsel for Luminos and signed all substantive filings, including the Complaint, discovery requests, the Opposition to Redstone's Motion for Summary Judgment, and all motion papers.

• Megan Forsyth — Associate. Ms. Forsyth assisted Mr. Hargrove with discovery matters, deposition preparation, and briefing support.

E. Expert Witnesses

Defense Expert — Dr. Ingrid Lautner

Dr. Ingrid Lautner is a Professor of Digital Media and Game Design at Pacific Western University. She was retained by Redstone on May 28, 2024, at a rate of $650 per hour, to provide expert testimony on the visual design elements at issue in the litigation. Dr. Lautner's expert report, served on August 19, 2024, provided a detailed pixel-comparison analysis of the 37 challenged visual assets, concluding that only 4 of the 37 assets exhibited a similarity index above 40%, and none exceeded 52%. She also opined extensively on the prevalence of the challenged design tropes within the fantasy role-playing game genre, supporting both the fair-use and scènes à faire defenses. Dr. Lautner's rebuttal expert report was served on September 3, 2024.

Plaintiff's Expert — Dr. Calvin Yates

Dr. Calvin Yates is an Independent Digital Forensics Consultant and former Associate Professor at Riverbend Institute of Technology. Dr. Yates was retained by Luminos to provide expert testimony on the similarity between the challenged visual assets in Ironclad Dominion and the corresponding assets in Shardfall Chronicles. His expert report, served on August 19, 2024, asserted that the similarities between the two games' visual assets were "striking" and "beyond the realm of coincidence." The Court, in its summary judgment ruling, found Dr. Yates's methodology less persuasive than Dr. Lautner's pixel-comparison analysis, particularly in light of the independent-creation evidence established by the ironclad-main Git repository.

F. Consultants and Vendors

Two third-party consulting firms were engaged to support the defense of this matter:

Brindoval Forensic Consulting LLC

Brindoval Forensic Consulting LLC was retained to perform digital forensics analysis and metadata verification of Redstone's ironclad-main Git repository. The firm's lead consultant was Nathan Rourke, and its offices are located at 3310 Wilshire Boulevard, Suite 700, Los Angeles, California 90010. Brindoval's work was central to establishing the independent-creation defense: Mr. Rourke and his team verified the authenticity and integrity of 14,208 commits spanning the period from February 12, 2020, through October 2022, confirming that the challenged assets were created independently and that the repository's version-control history had not been altered or manipulated. Brindoval's metadata verification report was relied upon by the Court in its summary judgment analysis.

Evergreen Valuation Group LLC

Evergreen Valuation Group LLC was retained to prepare a rebuttal damages analysis. The firm's lead analyst was Dr. Sandra Chu, and its offices are located at 55 West Monroe Street, Suite 2300, Chicago, Illinois 60603. Dr. Chu's rebuttal report demonstrated that Ironclad Dominion and Shardfall Chronicles occupied non-overlapping market segments — the former being a AAA multiplayer title and the latter a single-player indie game — and that Shardfall Chronicles unit sales had in fact increased by 18% in the six months following the release of Ironclad Dominion, negating Luminos's market-harm theory under the fourth fair-use factor.

G. Insurance Carrier

Defense costs for this matter were covered under an intellectual property litigation insurance policy issued by Pinnacle Mutual Insurance Co. to Redstone Gaming Corp. The relevant policy and claim details are as follows:

The insurance tender letter was sent to Pinnacle Mutual on April 8, 2024, shortly after the engagement was opened. Pinnacle Mutual accepted the defense tender and confirmed coverage under the policy. Throughout the litigation, Pinnacle Mutual processed all invoices submitted by Calderwood & Harkness LLP and third-party vendors on a timely basis, and no disputes arose regarding coverage or billing.

III. SUMMARY OF CLAIMS AND RELIEF SOUGHT

A. Luminos's Complaint

On March 18, 2024, Luminos Interactive LLC filed a Complaint for Copyright Infringement in the United States District Court for the District of Nevada, initiating this action against Redstone Gaming Corp. The Complaint was assigned Case No. 2:24-cv-00587-RWL and was assigned to the Honorable Rebecca W. Langford.

The Complaint alleged that 37 specific visual assets incorporated into Redstone's flagship title Ironclad Dominion (commercially released on November 14, 2022) were "substantially similar" to corresponding visual assets in Luminos's Shardfall Chronicles (commercially released on March 22, 2021). Luminos alleged that Redstone's artists had access to Shardfall Chronicles prior to creating the challenged assets and that the degree of similarity between the two sets of assets could not be attributed to coincidence or independent creation.

The 37 challenged assets were categorized by Luminos as follows:

• Character Armor Designs (12 assets): Luminos alleged that 12 character armor sets in Ironclad Dominion exhibited substantially similar silhouettes, ornamentation patterns, and color palettes to corresponding armor designs in Shardfall Chronicles.

• Environmental Crystal Textures (9 assets): Luminos alleged that 9 crystal and gemstone textures used in cave and dungeon environments in Ironclad Dominion were substantially similar to crystal textures used in the "Shard Caverns" levels of Shardfall Chronicles.

• UI Icon Sets (8 assets): Luminos alleged that 8 user interface icon sets — including inventory icons, status-effect indicators, and map markers — in Ironclad Dominion were substantially similar to corresponding UI elements in Shardfall Chronicles.

• Background Matte Paintings (8 assets): Luminos alleged that 8 background matte paintings used for environmental vistas in Ironclad Dominion were substantially similar to corresponding matte paintings in Shardfall Chronicles.

Luminos's copyright claim was predicated on Copyright Registration No. VA 2-254-781, which was registered with the United States Copyright Office on June 8, 2021, approximately three months after the commercial release of Shardfall Chronicles.

B. Relief Sought by Luminos

Luminos sought the following relief in its Complaint:

1. Injunctive Relief: Luminos sought an order requiring Redstone to remove all 37 allegedly infringing visual assets from Ironclad Dominion across all platforms and distribution channels, including any derivative works, updates, downloadable content, or marketing materials incorporating the challenged assets. Given that Ironclad Dominion is a live-service multiplayer title generating ongoing revenue, the injunctive relief sought would have required significant re-engineering of the game's visual assets and could have necessitated a temporary or extended suspension of the game's online services.

2. Actual Damages: Luminos sought actual damages in the amount of $28,500,000. This figure was derived from an apportioned-profits theory, calculated as follows: Ironclad Dominion generated approximately $312 million in Year-1 revenue following its November 14, 2022 release. Luminos's damages expert, Dr. Calvin Yates, opined that the 37 allegedly infringing visual assets contributed approximately 9.13% of the game's commercial appeal and consumer value, yielding an apportioned damages figure of approximately $28.5 million ($312,000,000 × 9.13% ≈ $28,496,000, rounded).

3. Statutory Damages in the Alternative: Luminos pleaded statutory damages under 17 U.S.C. § 504(c) as an alternative to actual damages, seeking up to $150,000 per work infringed in the event the Court found willful infringement.

4. Attorney's Fees and Costs: Luminos sought recovery of its reasonable attorney's fees and litigation costs under 17 U.S.C. § 505.

C. Redstone's Defenses

Redstone's defense strategy was organized around three principal pillars, each supported by substantial documentary and expert evidence:

Pillar 1 — Independent Creation

The independent-creation defense was anchored by the ironclad-main Git repository, which constituted the primary version-control system for all source code, visual assets, and design documentation for Ironclad Dominion. The repository's first commit was dated February 12, 2020 — more than 13 months before the commercial release of Shardfall Chronicles on March 22, 2021. Brindoval Forensic Consulting LLC conducted a comprehensive metadata analysis verifying the authenticity and integrity of 14,208 commits spanning the period from February 2020 through October 2022. Brindoval confirmed that the repository's commit history had not been altered, backdated, or otherwise manipulated, and that the creation dates of the challenged visual assets — as reflected in the commit log — predated or were contemporaneous with the earliest publicly available information about Shardfall Chronicles. This evidence established that Redstone's artists developed the challenged assets independently, without access to or knowledge of Luminos's work.

Pillar 2 — Scènes à Faire / Merger Doctrine

Redstone argued that many of the visual elements at issue — including crystalline cave textures, radial user-interface menus, and medieval plate-armor silhouettes — constitute standard genre tropes that are ubiquitous in the fantasy role-playing game genre and are therefore unprotectable under the scènes à faire doctrine and the merger doctrine. Dr. Ingrid Lautner's expert report catalogued dozens of prior fantasy RPG titles, dating back to the early 2000s, that incorporated substantially identical visual motifs, demonstrating that the challenged elements were generic expressions dictated by the conventions of the genre rather than original creative works protectable under copyright. The Court acknowledged the force of this argument in its ruling, noting that the scènes à faire doctrine applied to many of the challenged elements.

Pillar 3 — Fair Use Under 17 U.S.C. § 107

The fair-use defense served as the primary ground for Redstone's Motion for Summary Judgment and the ultimate basis for the Court's dismissal of the case. Redstone argued that, to the extent any similarities existed between the challenged assets and those in Shardfall Chronicles, the use was fair under all four factors of 17 U.S.C. § 107. This defense is analyzed in detail in Section V below.

IV. PROCEDURAL HISTORY

A. Pre-Litigation and Complaint

The factual timeline underlying this dispute is as follows:

• Q1 2020: Redstone Gaming Corp. commences development of Ironclad Dominion. The ironclad-main Git repository is initialized with its first commit on February 12, 2020. The game is conceived as a AAA multiplayer online role-playing game set in a mechanized-steampunk fantasy world.

• March 22, 2021: Luminos Interactive LLC commercially releases Shardfall Chronicles, a single-player indie fantasy RPG, on the Steam and Epic Games Store digital distribution platforms. The game receives modest critical acclaim within the indie gaming community and begins accumulating sales.

• June 8, 2021: Luminos registers the visual and audiovisual content of Shardfall Chronicles with the United States Copyright Office, receiving Copyright Registration No. VA 2-254-781.

• November 14, 2022: Redstone commercially releases Ironclad Dominion across console and PC platforms. The game becomes a commercial success, generating approximately $312 million in Year-1 revenue.

• March 18, 2024: Luminos Interactive LLC files its Complaint for Copyright Infringement against Redstone Gaming Corp. in the United States District Court for the District of Nevada. The case is assigned Case No. 2:24-cv-00587-RWL and is referred to the Honorable Rebecca W. Langford for all purposes, with discovery disputes referred to Magistrate Judge the Honorable David Chen.

B. Engagement and Initial Pleadings

• April 3, 2024: Calderwood & Harkness LLP opens the engagement for the defense of Redstone Gaming Corp. The matter is assigned Matter No. 1033-00004. Catherine Bloom is designated as Responsible Partner, Alan Ngo as Billing Partner, and Omar Siddiqui as Lead Associate.

• April 8, 2024: An insurance tender letter is sent to Pinnacle Mutual Insurance Co. under Policy No. PML-IP-2023-08841, notifying the carrier of the claim and requesting coverage for defense costs. Pinnacle Mutual acknowledges receipt and opens Claim No. PML-CLM-2024-3392. Franklin Teague is assigned as Claims Adjuster.

• April 22, 2024: Redstone files its Answer and Affirmative Defenses to Luminos's Complaint. The Answer denies all material allegations of infringement and asserts the following affirmative defenses: (i) fair use under 17 U.S.C. § 107; (ii) independent creation; (iii) scènes à faire / merger doctrine; and (iv) failure to state a claim upon which relief can be granted.

C. Discovery Phase

• May 6, 2024: The parties participate in the Rule 26(f) conference and submit their proposed discovery plan to the Court. The Court enters a scheduling order setting discovery deadlines and establishing the framework for the exchange of initial disclosures, written discovery, depositions, and expert reports.

• May 20, 2024: Redstone serves its initial disclosures pursuant to Federal Rule of Civil Procedure 26(a)(1), identifying key witnesses, documents, and damage calculations.

• May 28, 2024: Calderwood & Harkness retains Dr. Ingrid Lautner as defense expert witness. Dr. Lautner begins her review of the 37 challenged visual assets and the corresponding assets in Ironclad Dominion and Shardfall Chronicles.

• June 14, 2024: Luminos serves its First Set of Interrogatories (Nos. 1–25) and First Set of Requests for Production (Nos. 1–40) on Redstone. The discovery requests seek extensive information and documents relating to the development of Ironclad Dominion, including version-control records, internal communications, art direction documents, artist reference materials, and any internal analyses of competitor games including Shardfall Chronicles.

• July 8, 2024: Redstone serves its responses and objections to Luminos's First Set of Interrogatories and First Set of Requests for Production. Concurrently, Redstone produces 42,316 pages of documents, bearing Bates numbers RGC-000001 through RGC-042316. The production includes the ironclad-main Git repository commit logs, design documentation, internal communications, and art reference materials. Discovery disputes arising during this phase were referred to and resolved by Magistrate Judge the Honorable David Chen.

D. Depositions. Four fact-witness depositions were conducted during the discovery phase:

• July 22, 2024 — Tobias Crane (Luminos Founder & Managing Member): Deposed in Austin, Texas. Mr. Crane testified regarding the development history of Shardfall Chronicles, the creative process for the visual assets at issue, and Luminos's theory of access and substantial similarity. On cross-examination, Mr. Crane acknowledged that he was not aware of any direct evidence that Redstone's artists had viewed or referenced Shardfall Chronicles during the development of Ironclad Dominion.

• July 29, 2024 — Elara Whitfield (Luminos Art Director & Co-Founder): Deposed in Austin, Texas. Ms. Whitfield testified as the primary creator of the visual assets in Shardfall Chronicles and provided her assessment of the alleged similarities. On cross-examination, Ms. Whitfield conceded that certain design elements she described as original — including crystalline cave textures and radial menu layouts — are commonly found across multiple fantasy RPG titles predating Shardfall Chronicles.

• August 5, 2024 — Jordan Kessler (RGC VP of Creative Development): Deposed in Las Vegas, Nevada. Mr. Kessler testified regarding the independent creative development of Ironclad Dominion, the game's design philosophy and artistic influences, and the absence of any reference to or awareness of Shardfall Chronicles among the development team during the relevant time period. Mr. Kessler's testimony was consistent with the version-control records produced from the ironclad-main Git repository.

• August 12, 2024 — Seo-Yeon Park (RGC Lead Character Artist): Deposed in Las Vegas, Nevada. Ms. Park testified as the lead artist responsible for creating the character armor designs and environmental textures challenged by Luminos. Ms. Park stated unequivocally that she had not played, viewed, or been aware of Shardfall Chronicles at any point prior to or during the development of the challenged assets for Ironclad Dominion. She described her artistic influences and creative process in detail, providing a credible independent-creation narrative.

E. Expert Phase

• August 19, 2024: Expert reports are simultaneously exchanged. Dr. Ingrid Lautner serves her expert report on behalf of Redstone. Dr. Calvin Yates serves his expert report on behalf of Luminos.

Dr. Lautner's report included a comprehensive pixel-comparison analysis of all 37 challenged visual assets, using industry-standard image-analysis software and methodologies. Her analysis concluded that only 4 of the 37 challenged assets exhibited a similarity index above 40% (the threshold she identified as the minimum level of concern for potential copying), and that none of the 37 assets exceeded a 52% similarity index. She further opined that the observed similarities were attributable to shared genre conventions rather than copying, cataloguing numerous pre-existing fantasy RPG titles incorporating similar visual elements.

Dr. Yates's report employed a qualitative visual-comparison methodology, asserting that the similarities between the two games' visual assets were "striking" and "beyond the realm of coincidence." Dr. Yates did not perform a pixel-level quantitative analysis comparable to Dr. Lautner's.

• September 3, 2024: Dr. Lautner serves her rebuttal expert report, responding to Dr. Yates's opinions and identifying methodological deficiencies in his analysis, including the absence of quantitative metrics and the failure to account for the prevalence of the challenged design elements in the broader fantasy RPG genre.

F. Dispositive Motion Practice

• September 9, 2024: Redstone files its Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107. The motion is accompanied by a memorandum of points and authorities, a statement of undisputed material facts, declarations from Jordan Kessler and Seo-Yeon Park, Dr. Lautner's expert report and rebuttal report, Brindoval Forensic Consulting's metadata verification report, Evergreen Valuation Group's rebuttal damages report, and supporting exhibits.

• September 23, 2024: Luminos files its Opposition to Redstone's Motion for Summary Judgment, arguing that genuine disputes of material fact exist as to each of the four fair-use factors and that the independent-creation defense raises credibility determinations inappropriate for summary judgment resolution.

• September 30, 2024: Redstone files its Reply in Support of Motion for Summary Judgment, addressing each of Luminos's opposition arguments and demonstrating that no genuine dispute of material fact precluded summary judgment on the fair-use defense.

• October 15, 2024: Oral argument is held before the Honorable Rebecca W. Langford. Catherine Bloom appears on behalf of Redstone and presents oral argument. Daniel Hargrove appears on behalf of Luminos.

G. Disposition.

• October 22, 2024: The Court issues its Order granting Redstone's Motion for Summary Judgment. The Court conducts a thorough analysis of all four fair-use factors under 17 U.S.C. § 107 and finds that each factor weighs in favor of fair use (Factors 1, 3, and 4 strongly; Factor 2 slightly against but not dispositive). The Court additionally notes the strength of the independent-creation evidence and the applicability of the scènes à faire doctrine. The case is dismissed with prejudice.

Throughout the case, discovery disputes were handled by Magistrate Judge the Honorable David Chen, who presided over several informal discovery conferences and resolved objections related to the scope of document production and deposition questioning. No sanctions or adverse rulings were entered against Redstone in connection with any discovery matter.

V. SUMMARY OF THE COURT'S RULING

A. Fair-Use Analysis Under 17 U.S.C. § 107

The Court's October 22, 2024 Order analyzed each of the four statutory fair-use factors set forth in 17 U.S.C. § 107 and concluded that, on the undisputed record before it, the balance of factors weighed decisively in favor of Redstone.

Factor 1 — Purpose and Character of the Use. The Court examined whether Redstone's use of any allegedly similar visual elements was "transformative" — that is, whether the new work "adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message." Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994). The Court held that Ironclad Dominion is "highly transformative" in its treatment of the visual motifs at issue. Specifically, the Court found that Ironclad Dominion repurposes generic fantasy design motifs — such as crystalline environments, medieval armor silhouettes, and stylized UI iconography — into a wholly original mechanized-steampunk context, integrated with an original narrative framework, original game mechanics, and a fundamentally different aesthetic vision. The Court noted that the two games employ the shared motifs for "entirely different expressive purposes" and that any arguable similarities in individual assets are overwhelmed by the transformative context in which they are deployed.

The Court further noted that Ironclad Dominion is a commercial product, which ordinarily weighs against fair use, but emphasized that the Supreme Court has recognized that "nearly all of the illustrative uses listed in the preamble paragraph of § 107 . . . are generally conducted for profit," Campbell, 510 U.S. at 584, and that the commercial nature of the use does not defeat a finding of transformativeness.

This factor weighed strongly in Redstone's favor.

Factor 2 — Nature of the Copyrighted Work. The Court acknowledged that Shardfall Chronicles is a creative work — a video game involving significant artistic expression — and that creative works are "closer to the core of intended copyright protection" than factual or functional works. Campbell, 510 U.S. at 586. Accordingly, the Court found that this factor weighed slightly in Luminos's favor.

However, the Court expressly noted that "this factor has rarely been found dispositive in the fair-use analysis" and that it carries limited weight where, as here, the defendant's use is highly transformative. The Court observed that the second factor's significance is further diminished where the elements at issue include standard genre conventions that blur the line between protectable creative expression and unprotectable ideas and common tropes.

This factor weighed slightly in Luminos's favor, but the Court deemed it not dispositive.

Factor 3 — Amount and Substantiality of the Portion Used. The Court examined both the quantitative and qualitative extent of any overlap between the challenged assets. Central to the Court's analysis was Dr. Ingrid Lautner's pixel-comparison analysis, which the Court found to be "well-supported, methodologically rigorous, and persuasive."

Dr. Lautner's analysis demonstrated the following:

The Court found that the quantitative overlap between the challenged assets in the two games was "de minimis relative to each work's totality." The Court noted that Ironclad Dominion contains thousands of individual visual assets, and that the 37 challenged assets — even taken at their highest alleged similarity — constitute a vanishingly small fraction of the game's total visual content. Moreover, the Court found that none of the 37 challenged assets constituted the "heart" or most qualitatively significant portion of Shardfall Chronicles, as Luminos's own testimony acknowledged that the game's narrative, gameplay mechanics, and overall art direction are distinct from its individual component assets.

The Court contrasted Dr. Lautner's quantitative methodology with Dr. Yates's qualitative approach and found Dr. Yates's analysis "insufficiently rigorous to create a genuine dispute of material fact," noting that Dr. Yates failed to employ standard pixel-comparison tools and relied instead on subjective visual impressions.

This factor weighed in Redstone's favor.

Factor 4 — Effect on the Market for the Copyrighted Work. The Court examined whether Redstone's allegedly infringing use caused or was likely to cause market harm to Shardfall Chronicles. The Court relied heavily on the rebuttal damages report prepared by Evergreen Valuation Group LLC, led by Dr. Sandra Chu.

Dr. Chu's report demonstrated two key findings that the Court found dispositive on this factor:

1. Non-Overlapping Market Segments: Ironclad Dominion and Shardfall Chronicles occupy fundamentally different market segments. Ironclad Dominion is a AAA multiplayer online RPG marketed to the mass-market console and PC gaming audience, with a premium price point and live-service revenue model. Shardfall Chronicles is a single-player indie RPG marketed to a niche audience of indie gaming enthusiasts, sold at a lower price point without ongoing service revenue. The Court found that the two products "do not compete for the same consumer dollar" and that a reasonable consumer would not view one as a substitute for the other.

2. Absence of Actual Market Harm: Contrary to Luminos's market-harm theory, Shardfall Chronicles unit sales actually increased by 18% in the six months following Ironclad Dominion's release — from approximately 8,400 units per month to approximately 9,912 units per month. The Court noted that this sales increase was likely attributable, at least in part, to the increased visibility that Shardfall Chronicles received from public commentary and social media discussions comparing the two games. In any event, the Court concluded that Luminos had failed to demonstrate any actual or likely market harm resulting from Redstone's allegedly infringing use.

This factor weighed strongly in Redstone's favor.

B. Court's Conclusion

Having analyzed all four statutory factors, the Court concluded that the undisputed factual record established fair use as a matter of law. Three of the four factors (Factors 1, 3, and 4) weighed in Redstone's favor — Factors 1 and 4 strongly so — while Factor 2 weighed only slightly in Luminos's favor and was not dispositive. The Court emphasized that the fair-use analysis requires a holistic weighing of all factors and that no single factor is determinative.

In addition to its fair-use holding, the Court noted the strength of two additional grounds supporting judgment in Redstone's favor:

• Independent Creation: The ironclad-main Git repository's first commit, dated February 12, 2020, predated the release of Shardfall Chronicles by more than 13 months. The repository's 14,208 commits, verified by Brindoval Forensic Consulting as authentic and unaltered, provided compelling evidence that the challenged assets were independently created without reference to Luminos's work. The Court stated that the independent-creation evidence "standing alone, would raise serious doubt as to the viability of Luminos's infringement theory."

• Scènes à Faire Doctrine: The Court noted that many of the challenged elements — crystalline cave textures, radial menu interfaces, medieval plate-armor silhouettes — are standard visual conventions of the fantasy RPG genre that are "indispensable, or at least standard, in the treatment" of such works, and therefore are not protectable under copyright. Cain v. Universal Pictures Co., 47 F. Supp. 1013, 1017 (S.D. Cal. 1942).

The Court granted Redstone's Motion for Summary Judgment in its entirety and dismissed the case with prejudice.

VI. FINANCIAL SUMMARY — DEFENSE COSTS

A. Calderwood & Harkness LLP Fees

The following table summarizes the professional fees incurred by Calderwood & Harkness LLP in connection with the defense of this matter:

The distribution of hours across the litigation phases reflects the complexity and volume of the discovery process (which accounted for the largest share of attorney and paralegal time), the intensive expert-witness coordination and review, and the substantial investment in dispositive motion practice. Partner time was concentrated on strategic decision-making, key depositions, and the preparation and presentation of the summary judgment motion and oral argument.

B. Third-Party and Vendor Costs

The following table summarizes costs incurred by third-party counsel, consultants, and vendors in connection with this matter:

C. Total Defense Costs

D. Insurance Coverage and Client Out-of-Pocket Exposure

All defense costs incurred in this matter were covered by Pinnacle Mutual Insurance Co. under Policy No. PML-IP-2023-08841, subject to the $5,000 per-claim deductible. The intellectual property litigation sub-limit under the policy is $15,000,000 per occurrence, and total defense costs of $1,657,750.00 were well within the available coverage.

Pinnacle Mutual processed and reimbursed all invoices submitted under Claim No. PML-CLM-2024-3392 throughout the course of the litigation, and no disputes arose regarding coverage, billing rates, or the reasonableness of any fees or costs.

Redstone's net out-of-pocket cost for the defense of this matter was $5,000.00 (representing the per-claim deductible only). No additional financial exposure remains.

VII. APPEAL DEADLINE ANALYSIS

Under Federal Rule of Appellate Procedure 4(a)(1)(A), a party seeking to appeal a final judgment in a civil case must file a notice of appeal with the clerk of the district court within 30 days after entry of the judgment or order appealed from. The Court's Order granting Redstone's Motion for Summary Judgment and dismissing the case with prejudice was entered on October 22, 2024. Accordingly, the deadline for Luminos to file a notice of appeal to the United States Court of Appeals for the Ninth Circuit is November 21, 2024.

As of the date of this memorandum, no notice of appeal has been filed by Luminos Interactive LLC or its counsel, Hargrove, Tanaka & Whitmore LLP. Additionally, no post-judgment motions have been filed under Rule 59 (Motion to Alter or Amend a Judgment) or Rule 60 (Relief from a Judgment or Order) of the Federal Rules of Civil Procedure. Had any such motion been timely filed, it would have tolled the appeal deadline under Federal Rule of Appellate Procedure 4(a)(4)(A) until the entry of the order disposing of the last such remaining motion. Because no such motion has been filed, the appeal deadline remains November 21, 2024, and is not subject to tolling.

The case was dismissed with prejudice, which means that the judgment carries full res judicata effect and precludes any future relitigation of the same claims or any claims arising out of the same transaction or occurrence between the same parties.

I recommend that Calderwood & Harkness continue to monitor the docket in Case No. 2:24-cv-00587-RWL through the expiration of the appeal deadline on November 21, 2024. If no notice of appeal is filed by that date, the judgment will become final and nonappealable, and the matter can be confirmed for formal closure at that time.

In the event that Luminos does file a notice of appeal, I will immediately notify Catherine Bloom, Alan Ngo, and Priya Venkatesh, and will prepare a preliminary assessment of the appellate issues and the likelihood of success on appeal.

VIII. DOCUMENT RETENTION AND FILE MANAGEMENT

A. File Retention Schedule

In accordance with Calderwood & Harkness LLP's standard document retention policy and the terms of the engagement letter executed by Redstone Gaming Corp. on April 3, 2024, all client files associated with Matter No. 1033-00004 will be retained for a minimum period of seven (7) years from the date of formal matter closure. Upon expiration of the retention period, the firm will notify the Client and seek instructions regarding the disposition of the files, including the option of return to the Client or destruction in accordance with applicable ethical obligations.

All electronic files — including pleadings, correspondence, attorney work product, discovery materials, expert reports, and internal communications — have been archived within the firm's document management system under Matter No. 1033-00004. Electronic files are maintained on secure, encrypted servers with redundant backup in accordance with the firm's information security policies.

Hard-copy exhibits, deposition transcripts, and any physical materials received during the course of the litigation will be stored in the firm's off-site records storage facility in accordance with the firm's records management protocol. An inventory of all hard-copy materials has been prepared and is maintained in the electronic matter file.

B. Key Documents for Permanent Retention

The following categories of documents have been identified for permanent retention within the matter file, irrespective of the general retention schedule, due to their significance to the outcome of the litigation and their potential relevance to any future proceedings:

1. The Court's October 22, 2024 Order granting Redstone's Motion for Summary Judgment and dismissing the case with prejudice.

2. All filed pleadings and briefs, including the Complaint, Answer and Affirmative Defenses, Motion for Summary Judgment and supporting memorandum, Opposition, Reply, and all supporting declarations and exhibits.

3. Expert reports of Dr. Ingrid Lautner (initial report and rebuttal report, dated August 19, 2024 and September 3, 2024, respectively) and Dr. Calvin Yates (initial report dated August 19, 2024).

4. Brindoval Forensic Consulting LLC's metadata verification report, documenting the analysis and verification of the ironclad-main Git repository.

5. Evergreen Valuation Group LLC's rebuttal damages report, including the market-segment analysis and the Shardfall Chronicles sales-trend data.

6. Deposition transcripts of Tobias Crane (July 22, 2024), Elara Whitfield (July 29, 2024), Jordan Kessler (August 5, 2024), and Seo-Yeon Park (August 12, 2024).

7. Insurance correspondence and coverage confirmations with Pinnacle Mutual Insurance Co., including the tender letter dated April 8, 2024, coverage acceptance, and all claims correspondence under Claim No. PML-CLM-2024-3392.

C. Privilege and Work-Product Materials

All attorney work-product memoranda, litigation strategy documents, internal communications, mental impressions, and legal analyses prepared in connection with this matter remain protected by the attorney-client privilege and the attorney work-product doctrine. No waiver of privilege occurred during the course of the litigation, whether through inadvertent disclosure, at-issue waiver, or otherwise. The privilege log maintained during the discovery phase documented all withheld materials and was not challenged by Luminos.

Upon formal closure of the matter, all privileged and work-product materials will continue to be maintained under the firm's standard confidentiality protocols and will not be disclosed to any person outside the firm without the prior written consent of the Responsible Partner and, where required, the Client.

IX. RECOMMENDED NEXT STEPS

A. Client Notification

I recommend that Calderwood & Harkness LLP send a formal outcome letter to Priya Venkatesh, General Counsel, Redstone Gaming Corp., at 4100 Obsidian Tower Boulevard, Suite 2200, Las Vegas, Nevada 89109. The letter should confirm the dismissal of Case No. 2:24-cv-00587-RWL with prejudice on fair-use grounds, summarize the Court's ruling and the favorable result achieved, provide final defense cost figures, and advise the Client regarding the appeal deadline. A draft of this letter will be circulated to Catherine Bloom and Alan Ngo for review and approval prior to transmittal.

B. Insurance Carrier Notification

I recommend sending a final disposition notice to Franklin Teague, Claims Adjuster, Pinnacle Mutual Insurance Co., at 200 Commerce Drive, Hartford, Connecticut 06103. The notice should confirm the final outcome of the litigation, provide a copy of the Court's October 22, 2024 Order, report the final total defense costs of $1,657,750.00, and request formal closure of Claim No. PML-CLM-2024-3392. Any remaining outstanding invoices should be identified for final processing prior to claim closure.

C. Local Counsel Notification

I recommend notifying Patricia Thorngate at Thorngate & Associates, PC of the matter closure and coordinating any remaining local filings or administrative matters in the District of Nevada. Ms. Thorngate should be asked to confirm that no outstanding local obligations exist, including any state bar or local court administrative requirements.

D. Vendor Notifications

I recommend confirming final invoicing from all third-party vendors engaged in connection with this matter:

• Brindoval Forensic Consulting LLC — Confirm that all work has been completed and that the final invoice has been received and processed.

• Dr. Ingrid Lautner — Confirm that all outstanding fees and expenses have been invoiced and processed.

• Evergreen Valuation Group LLC — Confirm that all work has been completed and that the final invoice has been received and processed.

All final vendor invoices should be submitted to Pinnacle Mutual Insurance Co. for reimbursement under Claim No. PML-CLM-2024-3392 prior to closure of the insurance claim.

E. Docket Monitoring

I recommend that Calderwood & Harkness LLP continue monitoring the docket in Case No. 2:24-cv-00587-RWL through the appeal deadline of November 21, 2024. Our automated docket monitoring service has been configured to provide real-time alerts for any new filings in this case. If no notice of appeal is filed by Luminos or Hargrove, Tanaka & Whitmore LLP by November 21, 2024, I will circulate a final confirmation memorandum and recommend formal closure.

F. File Closure

Upon expiration of the appeal period on November 21, 2024, without the filing of a notice of appeal, I recommend the following file-closure actions:

1. Formally close Matter No. 1033-00004 in the firm's matter management system, updating the matter status to "Closed — Favorable Disposition."

2. Generate a final billing statement reflecting all time entries and costs incurred throughout the engagement, including any final entries for matter-closure activities.

3. Reconcile all time and costs against Pinnacle Mutual Insurance Co. reimbursements to confirm that all amounts have been properly billed, submitted, and reimbursed, and that Redstone's net out-of-pocket exposure is limited to the $5,000 deductible.

4. Archive all electronic and hard-copy files in accordance with the retention schedule described in Section VIII above.

X. CONCLUSION

Matter No. 1033-00004, Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL, has been resolved in a manner that represents a complete and unqualified defense victory for our client, Redstone Gaming Corp.

The case was resolved on summary judgment without the need for trial. The Court's October 22, 2024 Order granted Redstone's Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107, with the Court finding that three of the four statutory fair-use factors weighed in Redstone's favor (Factors 1 and 4 strongly, Factor 3 moderately), while the sole factor weighing against Redstone (Factor 2) was not dispositive. The Court additionally recognized the strength of Redstone's independent-creation evidence and the applicability of the scènes à faire doctrine to many of the challenged visual elements.

Luminos Interactive LLC's claims for $28.5 million in actual damages, injunctive relief, statutory damages, and attorney's fees have been fully dismissed with prejudice, and the judgment carries res judicata effect precluding any future relitigation of the same claims.

Redstone's net financial exposure in this matter has been limited to $5,000 — the per-claim deductible under its intellectual property litigation insurance policy with Pinnacle Mutual Insurance Co. Total defense costs of $1,657,750.00 were substantially covered by Pinnacle Mutual under Policy No. PML-IP-2023-08841, Claim No. PML-CLM-2024-3392.

No outstanding issues remain. I recommend formal file closure upon the expiration of the thirty-day appeal period on November 21, 2024, assuming no notice of appeal is filed. In the interim, the docket will continue to be monitored as described in this memorandum.

I am available to discuss any aspect of this memorandum at your convenience and will proceed with the recommended next steps upon your approval.

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
MATTER CLOSING MEMORANDUM
This memorandum is protected by the attorney-client privilege and the attorney work-product doctrine. It has been prepared exclusively for internal use by Calderwood & Harkness LLP attorneys assigned to Matter No. 1033-00004. This memorandum and its contents should not be disclosed to any person outside the firm without the prior written consent of the Responsible Partner. Any inadvertent disclosure does not constitute a waiver of any applicable privilege.
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I. EXECUTIVE SUMMARY
The purpose of this memorandum is to document the successful resolution of Matter No. 1033-00004 and to recommend the formal closure of the file in accordance with Calderwood & Harkness LLP's standard matter management procedures.
On October 22, 2024, the Honorable Rebecca W. Langford of the United States District Court for the District of Nevada granted Redstone Gaming Corp.'s Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107 in the matter styled Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL. The Court's order dismissed the case with prejudice, thereby fully and finally extinguishing all claims asserted by Plaintiff Luminos Interactive LLC ("Luminos") against our client Redstone Gaming Corp. ("Redstone" or the "Client").
Luminos had sought actual damages in the amount of $28.5 million based on an apportioned-profits theory, injunctive relief ordering the removal of allegedly infringing visual assets from Redstone's flagship title Ironclad Dominion, statutory damages in the alternative, and recovery of attorney's fees and costs. Each of these claims has now been dismissed with prejudice, and the judgment carries res judicata effect precluding any future relitigation of the same claims between the parties.
Redstone's net out-of-pocket cost for the defense of this action was limited to $5,000, representing the per-claim deductible under Pinnacle Mutual Insurance Co. Policy No. PML-IP-2023-08841. Total defense costs incurred by the firm and third-party vendors amounted to $1,657,750, the entirety of which (above the deductible) was covered by Pinnacle Mutual under the intellectual property litigation sub-limit of $15 million per occurrence (Claim No. PML-CLM-2024-3392). At no point during the litigation did defense costs approach the policy sub-limit, and Pinnacle Mutual has made timely reimbursements on all invoices submitted through the claims process.
As of the date of this memorandum, no notice of appeal has been filed by Luminos or its counsel, Hargrove, Tanaka & Whitmore LLP. The appeal deadline under Federal Rule of Appellate Procedure 4(a)(1)(A) is November 21, 2024 (thirty days from entry of judgment). No post-judgment motions under Rule 59 or Rule 60 of the Federal Rules of Civil Procedure have been filed that would toll the appeal period. Additional analysis of the appeal deadline is set forth in Section VII below.
Based on the foregoing, I recommend the following closing actions: (1) sending a formal outcome letter to Priya Venkatesh, General Counsel of Redstone Gaming Corp., confirming the dismissal with prejudice and summarizing the favorable result; (2) notifying Franklin Teague, Claims Adjuster at Pinnacle Mutual Insurance Co., of the final disposition and providing final defense cost figures to close Claim No. PML-CLM-2024-3392; (3) notifying local Nevada counsel, Patricia Thorngate of Thorngate & Associates, PC, of the matter closure; (4) confirming final invoicing from all third-party vendors; (5) continuing to monitor the docket through the November 21, 2024 appeal deadline; and (6) upon expiration of the appeal period without the filing of a notice of appeal, formally closing Matter No. 1033-00004 in the firm's matter management system and generating final billing reconciliation.
This memorandum sets forth in detail the parties and counsel involved, the claims and defenses at issue, the full procedural history of the litigation, a summary of the Court's ruling, a financial summary of all defense costs incurred, analysis of appeal deadlines, document retention protocols, and recommended next steps for file closure.
II. PARTIES AND COUNSEL
A. Defendant — Redstone Gaming Corp.
Redstone Gaming Corp. ("Redstone") is a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol RDST. Redstone is one of the leading interactive entertainment companies in the United States, specializing in the development, publishing, and live operation of multiplayer online gaming titles across console and personal computer platforms.
Redstone's corporate headquarters are located at 4100 Obsidian Tower Boulevard, Suite 2200, Las Vegas, Nevada 89109. Its registered agent for service of process in the State of Delaware is Capitol Registered Agents, Inc., located at 1209 Orange Street, Wilmington, Delaware 19801. Redstone's Employer Identification Number (EIN) is 88-3421076.
Redstone is led by Chief Executive Officer Marcus Hale, who has served in that capacity since the company's founding in 2017. The company's General Counsel is Priya Venkatesh, who served as the primary client contact throughout this engagement and authorized all material litigation strategy decisions on behalf of the Client.
As of fiscal year 2023, Redstone reported annual revenue of approximately $1.87 billion. At the time of the commencement of this litigation in April 2024, Redstone had an approximate market capitalization of $6.4 billion and employed approximately 4,200 individuals across its domestic and international studio operations.
Two Redstone personnel were centrally involved in the defense of this matter:
•  Jordan Kessler, Vice President of Creative Development, who oversaw the creative direction of Ironclad Dominion from its inception in early 2020 through its commercial release in November 2022. Mr. Kessler provided critical testimony regarding the independent development timeline and the conceptual origins of the game's visual design language.
•  Seo-Yeon Park, Lead Character Artist on Ironclad Dominion, who was directly responsible for the creation of the character armor designs and environmental textures challenged by Luminos. Ms. Park's testimony, supported by the version-control history in the ironclad-main Git repository, demonstrated that the challenged assets were independently conceived and executed without reference to Shardfall Chronicles.
B. Plaintiff — Luminos Interactive LLC
Luminos Interactive LLC ("Luminos") is a Texas limited liability company engaged in the development and self-publishing of independent video game titles. Luminos's principal office is located at 802 Brazos Creek Lane, Suite 5, Austin, Texas 78701. Its registered agent for service of process in the State of Texas is Texas Statutory Agents LLC, located at 1601 Rio Grande Street, Austin, Texas 78701.
Luminos was founded by Tobias Crane, who serves as the Managing Member and is responsible for all business and operational decisions. Elara Whitfield serves as Art Director and Co-Founder, and was the primary creator of the visual assets at the center of this dispute. Luminos's Employer Identification Number (EIN) is 84-5093218.
Luminos is a small independent studio. For fiscal year 2023, the company reported revenue of approximately $2.1 million and maintained a headcount of approximately 14 employees. The product at issue in this litigation was Shardfall Chronicles, an indie single-player fantasy role-playing game released on March 22, 2021. As of the filing of the complaint, Shardfall Chronicles had sold approximately 185,000 lifetime units at a manufacturer's suggested retail price (MSRP) of $24.99 per unit, generating estimated gross revenue of approximately $4.62 million since launch.
C. Defense Counsel
Lead Counsel — Calderwood & Harkness LLP
Calderwood & Harkness LLP served as lead defense counsel for Redstone Gaming Corp. throughout this matter. The firm's offices are located at 600 South Grand Avenue, Suite 4400, Los Angeles, California 90071. The following attorneys were assigned to the matter:
•  Catherine Bloom — Responsible Partner, intellectual Property. Ms. Bloom provided strategic oversight throughout the litigation, participated in key depositions, supervised the summary judgment briefing, and presented oral argument before the Court on October 15, 2024.
•  Alan Ngo — Billing Partner, intellectual Property. Mr. Ngo managed all billing and financial aspects of the engagement, coordinated with Pinnacle Mutual Insurance Co. on coverage matters, and provided substantive input on the fair-use and independent-creation defenses.
•  Omar Siddiqui — Lead Associate, intellectual Property. Mr. Siddiqui served as the day-to-day lead for the litigation team, managing discovery, drafting the summary judgment motion and supporting briefs, coordinating with expert witnesses and forensic consultants, and overseeing all document production.
•  Christy Bauer — Working Associate, intellectual Property. Ms. Bauer assisted with discovery responses, deposition preparation, document review, and research and drafting support throughout the litigation.
Local Nevada Counsel — Thorngate & Associates, PC
Thorngate & Associates, PC served as local counsel in the District of Nevada. The firm's offices are located at 300 South Fourth Street, Suite 1100, Las Vegas, Nevada 89101. The lead attorney assigned from the firm was:
•  Patricia Thorngate — Lead Attorney. Ms. Thorngate handled all local procedural requirements, attended hearings and conferences before the Court and the Magistrate Judge, and coordinated logistics for depositions conducted in Las Vegas.
D. Plaintiff's Counsel
Luminos Interactive LLC was represented throughout this matter by Hargrove, Tanaka & Whitmore LLP, a litigation firm with offices at 1400 Congress Avenue, Suite 900, Austin, Texas 78701. The following attorneys appeared on behalf of Luminos:
•  Daniel Hargrove — Lead Attorney and Named Partner. Mr. Hargrove served as lead counsel for Luminos and signed all substantive filings, including the Complaint, discovery requests, the Opposition to Redstone's Motion for Summary Judgment, and all motion papers.
•  Megan Forsyth — Associate. Ms. Forsyth assisted Mr. Hargrove with discovery matters, deposition preparation, and briefing support.
E. Expert Witnesses
Defense Expert — Dr. Ingrid Lautner
Dr. Ingrid Lautner is a Professor of Digital Media and Game Design at Pacific Western University. She was retained by Redstone on May 28, 2024, at a rate of $650 per hour, to provide expert testimony on the visual design elements at issue in the litigation. Dr. Lautner's expert report, served on August 19, 2024, provided a detailed pixel-comparison analysis of the 37 challenged visual assets, concluding that only 4 of the 37 assets exhibited a similarity index above 40%, and none exceeded 52%. She also opined extensively on the prevalence of the challenged design tropes within the fantasy role-playing game genre, supporting both the fair-use and scènes à faire defenses. Dr. Lautner's rebuttal expert report was served on September 3, 2024.
Plaintiff's Expert — Dr. Calvin Yates
Dr. Calvin Yates is an Independent Digital Forensics Consultant and former Associate Professor at Riverbend Institute of Technology. Dr. Yates was retained by Luminos to provide expert testimony on the similarity between the challenged visual assets in Ironclad Dominion and the corresponding assets in Shardfall Chronicles. His expert report, served on August 19, 2024, asserted that the similarities between the two games' visual assets were "striking" and "beyond the realm of coincidence." The Court, in its summary judgment ruling, found Dr. Yates's methodology less persuasive than Dr. Lautner's pixel-comparison analysis, particularly in light of the independent-creation evidence established by the ironclad-main Git repository.
F. Consultants and Vendors
Two third-party consulting firms were engaged to support the defense of this matter:
Brindoval Forensic Consulting LLC
Brindoval Forensic Consulting LLC was retained to perform digital forensics analysis and metadata verification of Redstone's ironclad-main Git repository. The firm's lead consultant was Nathan Rourke, and its offices are located at 3310 Wilshire Boulevard, Suite 700, Los Angeles, California 90010. Brindoval's work was central to establishing the independent-creation defense: Mr. Rourke and his team verified the authenticity and integrity of 14,208 commits spanning the period from February 12, 2020, through October 2022, confirming that the challenged assets were created independently and that the repository's version-control history had not been altered or manipulated. Brindoval's metadata verification report was relied upon by the Court in its summary judgment analysis.
Evergreen Valuation Group LLC
Evergreen Valuation Group LLC was retained to prepare a rebuttal damages analysis. The firm's lead analyst was Dr. Sandra Chu, and its offices are located at 55 West Monroe Street, Suite 2300, Chicago, Illinois 60603. Dr. Chu's rebuttal report demonstrated that Ironclad Dominion and Shardfall Chronicles occupied non-overlapping market segments — the former being a AAA multiplayer title and the latter a single-player indie game — and that Shardfall Chronicles unit sales had in fact increased by 18% in the six months following the release of Ironclad Dominion, negating Luminos's market-harm theory under the fourth fair-use factor.
G. Insurance Carrier
Defense costs for this matter were covered under an intellectual property litigation insurance policy issued by Pinnacle Mutual Insurance Co. to Redstone Gaming Corp. The relevant policy and claim details are as follows:
The insurance tender letter was sent to Pinnacle Mutual on April 8, 2024, shortly after the engagement was opened. Pinnacle Mutual accepted the defense tender and confirmed coverage under the policy. Throughout the litigation, Pinnacle Mutual processed all invoices submitted by Calderwood & Harkness LLP and third-party vendors on a timely basis, and no disputes arose regarding coverage or billing.
III. SUMMARY OF CLAIMS AND RELIEF SOUGHT
A. Luminos's Complaint
On March 18, 2024, Luminos Interactive LLC filed a Complaint for Copyright Infringement in the United States District Court for the District of Nevada, initiating this action against Redstone Gaming Corp. The Complaint was assigned Case No. 2:24-cv-00587-RWL and was assigned to the Honorable Rebecca W. Langford.
The Complaint alleged that 37 specific visual assets incorporated into Redstone's flagship title Ironclad Dominion (commercially released on November 14, 2022) were "substantially similar" to corresponding visual assets in Luminos's Shardfall Chronicles (commercially released on March 22, 2021). Luminos alleged that Redstone's artists had access to Shardfall Chronicles prior to creating the challenged assets and that the degree of similarity between the two sets of assets could not be attributed to coincidence or independent creation.
The 37 challenged assets were categorized by Luminos as follows:
•  Character Armor Designs (12 assets): Luminos alleged that 12 character armor sets in Ironclad Dominion exhibited substantially similar silhouettes, ornamentation patterns, and color palettes to corresponding armor designs in Shardfall Chronicles.
•  Environmental Crystal Textures (9 assets): Luminos alleged that 9 crystal and gemstone textures used in cave and dungeon environments in Ironclad Dominion were substantially similar to crystal textures used in the "Shard Caverns" levels of Shardfall Chronicles.
•  UI Icon Sets (8 assets): Luminos alleged that 8 user interface icon sets — including inventory icons, status-effect indicators, and map markers — in Ironclad Dominion were substantially similar to corresponding UI elements in Shardfall Chronicles.
•  Background Matte Paintings (8 assets): Luminos alleged that 8 background matte paintings used for environmental vistas in Ironclad Dominion were substantially similar to corresponding matte paintings in Shardfall Chronicles.
Luminos's copyright claim was predicated on Copyright Registration No. VA 2-254-781, which was registered with the United States Copyright Office on June 8, 2021, approximately three months after the commercial release of Shardfall Chronicles.
B. Relief Sought by Luminos
Luminos sought the following relief in its Complaint:
1.  Injunctive Relief: Luminos sought an order requiring Redstone to remove all 37 allegedly infringing visual assets from Ironclad Dominion across all platforms and distribution channels, including any derivative works, updates, downloadable content, or marketing materials incorporating the challenged assets. Given that Ironclad Dominion is a live-service multiplayer title generating ongoing revenue, the injunctive relief sought would have required significant re-engineering of the game's visual assets and could have necessitated a temporary or extended suspension of the game's online services.
2.  Actual Damages: Luminos sought actual damages in the amount of $28,500,000. This figure was derived from an apportioned-profits theory, calculated as follows: Ironclad Dominion generated approximately $312 million in Year-1 revenue following its November 14, 2022 release. Luminos's damages expert, Dr. Calvin Yates, opined that the 37 allegedly infringing visual assets contributed approximately 9.13% of the game's commercial appeal and consumer value, yielding an apportioned damages figure of approximately $28.5 million ($312,000,000 × 9.13% ≈ $28,496,000, rounded).
3.  Statutory Damages in the Alternative: Luminos pleaded statutory damages under 17 U.S.C. § 504(c) as an alternative to actual damages, seeking up to $150,000 per work infringed in the event the Court found willful infringement.
4.  Attorney's Fees and Costs: Luminos sought recovery of its reasonable attorney's fees and litigation costs under 17 U.S.C. § 505.
C. Redstone's Defenses
Redstone's defense strategy was organized around three principal pillars, each supported by substantial documentary and expert evidence:
Pillar 1 — Independent Creation
The independent-creation defense was anchored by the ironclad-main Git repository, which constituted the primary version-control system for all source code, visual assets, and design documentation for Ironclad Dominion. The repository's first commit was dated February 12, 2020 — more than 13 months before the commercial release of Shardfall Chronicles on March 22, 2021. Brindoval Forensic Consulting LLC conducted a comprehensive metadata analysis verifying the authenticity and integrity of 14,208 commits spanning the period from February 2020 through October 2022. Brindoval confirmed that the repository's commit history had not been altered, backdated, or otherwise manipulated, and that the creation dates of the challenged visual assets — as reflected in the commit log — predated or were contemporaneous with the earliest publicly available information about Shardfall Chronicles. This evidence established that Redstone's artists developed the challenged assets independently, without access to or knowledge of Luminos's work.
Pillar 2 — Scènes à Faire / Merger Doctrine
Redstone argued that many of the visual elements at issue — including crystalline cave textures, radial user-interface menus, and medieval plate-armor silhouettes — constitute standard genre tropes that are ubiquitous in the fantasy role-playing game genre and are therefore unprotectable under the scènes à faire doctrine and the merger doctrine. Dr. Ingrid Lautner's expert report catalogued dozens of prior fantasy RPG titles, dating back to the early 2000s, that incorporated substantially identical visual motifs, demonstrating that the challenged elements were generic expressions dictated by the conventions of the genre rather than original creative works protectable under copyright. The Court acknowledged the force of this argument in its ruling, noting that the scènes à faire doctrine applied to many of the challenged elements.
Pillar 3 — Fair Use Under 17 U.S.C. § 107
The fair-use defense served as the primary ground for Redstone's Motion for Summary Judgment and the ultimate basis for the Court's dismissal of the case. Redstone argued that, to the extent any similarities existed between the challenged assets and those in Shardfall Chronicles, the use was fair under all four factors of 17 U.S.C. § 107. This defense is analyzed in detail in Section V below.
IV. PROCEDURAL HISTORY
A. Pre-Litigation and Complaint
The factual timeline underlying this dispute is as follows:
•  Q1 2020: Redstone Gaming Corp. commences development of Ironclad Dominion. The ironclad-main Git repository is initialized with its first commit on February 12, 2020. The game is conceived as a AAA multiplayer online role-playing game set in a mechanized-steampunk fantasy world.
•  March 22, 2021: Luminos Interactive LLC commercially releases Shardfall Chronicles, a single-player indie fantasy RPG, on the Steam and Epic Games Store digital distribution platforms. The game receives modest critical acclaim within the indie gaming community and begins accumulating sales.
•  June 8, 2021: Luminos registers the visual and audiovisual content of Shardfall Chronicles with the United States Copyright Office, receiving Copyright Registration No. VA 2-254-781.
•  November 14, 2022: Redstone commercially releases Ironclad Dominion across console and PC platforms. The game becomes a commercial success, generating approximately $312 million in Year-1 revenue.
•  March 18, 2024: Luminos Interactive LLC files its Complaint for Copyright Infringement against Redstone Gaming Corp. in the United States District Court for the District of Nevada. The case is assigned Case No. 2:24-cv-00587-RWL and is referred to the Honorable Rebecca W. Langford for all purposes, with discovery disputes referred to Magistrate Judge the Honorable David Chen.
B. Engagement and Initial Pleadings
•  April 3, 2024: Calderwood & Harkness LLP opens the engagement for the defense of Redstone Gaming Corp. The matter is assigned Matter No. 1033-00004. Catherine Bloom is designated as Responsible Partner, Alan Ngo as Billing Partner, and Omar Siddiqui as Lead Associate.
•  April 8, 2024: An insurance tender letter is sent to Pinnacle Mutual Insurance Co. under Policy No. PML-IP-2023-08841, notifying the carrier of the claim and requesting coverage for defense costs. Pinnacle Mutual acknowledges receipt and opens Claim No. PML-CLM-2024-3392. Franklin Teague is assigned as Claims Adjuster.
•  April 22, 2024: Redstone files its Answer and Affirmative Defenses to Luminos's Complaint. The Answer denies all material allegations of infringement and asserts the following affirmative defenses: (i) fair use under 17 U.S.C. § 107; (ii) independent creation; (iii) scènes à faire / merger doctrine; and (iv) failure to state a claim upon which relief can be granted.
C. Discovery Phase
•  May 6, 2024: The parties participate in the Rule 26(f) conference and submit their proposed discovery plan to the Court. The Court enters a scheduling order setting discovery deadlines and establishing the framework for the exchange of initial disclosures, written discovery, depositions, and expert reports.
•  May 20, 2024: Redstone serves its initial disclosures pursuant to Federal Rule of Civil Procedure 26(a)(1), identifying key witnesses, documents, and damage calculations.
•  May 28, 2024: Calderwood & Harkness retains Dr. Ingrid Lautner as defense expert witness. Dr. Lautner begins her review of the 37 challenged visual assets and the corresponding assets in Ironclad Dominion and Shardfall Chronicles.
•  June 14, 2024: Luminos serves its First Set of Interrogatories (Nos. 1–25) and First Set of Requests for Production (Nos. 1–40) on Redstone. The discovery requests seek extensive information and documents relating to the development of Ironclad Dominion, including version-control records, internal communications, art direction documents, artist reference materials, and any internal analyses of competitor games including Shardfall Chronicles.
•  July 8, 2024: Redstone serves its responses and objections to Luminos's First Set of Interrogatories and First Set of Requests for Production. Concurrently, Redstone produces 42,316 pages of documents, bearing Bates numbers RGC-000001 through RGC-042316. The production includes the ironclad-main Git repository commit logs, design documentation, internal communications, and art reference materials. Discovery disputes arising during this phase were referred to and resolved by Magistrate Judge the Honorable David Chen.
D. Depositions.  Four fact-witness depositions were conducted during the discovery phase:
•  July 22, 2024 — Tobias Crane (Luminos Founder & Managing Member): Deposed in Austin, Texas. Mr. Crane testified regarding the development history of Shardfall Chronicles, the creative process for the visual assets at issue, and Luminos's theory of access and substantial similarity. On cross-examination, Mr. Crane acknowledged that he was not aware of any direct evidence that Redstone's artists had viewed or referenced Shardfall Chronicles during the development of Ironclad Dominion.
•  July 29, 2024 — Elara Whitfield (Luminos Art Director & Co-Founder): Deposed in Austin, Texas. Ms. Whitfield testified as the primary creator of the visual assets in Shardfall Chronicles and provided her assessment of the alleged similarities. On cross-examination, Ms. Whitfield conceded that certain design elements she described as original — including crystalline cave textures and radial menu layouts — are commonly found across multiple fantasy RPG titles predating Shardfall Chronicles.
•  August 5, 2024 — Jordan Kessler (RGC VP of Creative Development): Deposed in Las Vegas, Nevada. Mr. Kessler testified regarding the independent creative development of Ironclad Dominion, the game's design philosophy and artistic influences, and the absence of any reference to or awareness of Shardfall Chronicles among the development team during the relevant time period. Mr. Kessler's testimony was consistent with the version-control records produced from the ironclad-main Git repository.
•  August 12, 2024 — Seo-Yeon Park (RGC Lead Character Artist): Deposed in Las Vegas, Nevada. Ms. Park testified as the lead artist responsible for creating the character armor designs and environmental textures challenged by Luminos. Ms. Park stated unequivocally that she had not played, viewed, or been aware of Shardfall Chronicles at any point prior to or during the development of the challenged assets for Ironclad Dominion. She described her artistic influences and creative process in detail, providing a credible independent-creation narrative.
E. Expert Phase
•  August 19, 2024: Expert reports are simultaneously exchanged. Dr. Ingrid Lautner serves her expert report on behalf of Redstone. Dr. Calvin Yates serves his expert report on behalf of Luminos.
Dr. Lautner's report included a comprehensive pixel-comparison analysis of all 37 challenged visual assets, using industry-standard image-analysis software and methodologies. Her analysis concluded that only 4 of the 37 challenged assets exhibited a similarity index above 40% (the threshold she identified as the minimum level of concern for potential copying), and that none of the 37 assets exceeded a 52% similarity index. She further opined that the observed similarities were attributable to shared genre conventions rather than copying, cataloguing numerous pre-existing fantasy RPG titles incorporating similar visual elements.
Dr. Yates's report employed a qualitative visual-comparison methodology, asserting that the similarities between the two games' visual assets were "striking" and "beyond the realm of coincidence." Dr. Yates did not perform a pixel-level quantitative analysis comparable to Dr. Lautner's.
•  September 3, 2024: Dr. Lautner serves her rebuttal expert report, responding to Dr. Yates's opinions and identifying methodological deficiencies in his analysis, including the absence of quantitative metrics and the failure to account for the prevalence of the challenged design elements in the broader fantasy RPG genre.
F. Dispositive Motion Practice
•  September 9, 2024: Redstone files its Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107. The motion is accompanied by a memorandum of points and authorities, a statement of undisputed material facts, declarations from Jordan Kessler and Seo-Yeon Park, Dr. Lautner's expert report and rebuttal report, Brindoval Forensic Consulting's metadata verification report, Evergreen Valuation Group's rebuttal damages report, and supporting exhibits.
•  September 23, 2024: Luminos files its Opposition to Redstone's Motion for Summary Judgment, arguing that genuine disputes of material fact exist as to each of the four fair-use factors and that the independent-creation defense raises credibility determinations inappropriate for summary judgment resolution.
•  September 30, 2024: Redstone files its Reply in Support of Motion for Summary Judgment, addressing each of Luminos's opposition arguments and demonstrating that no genuine dispute of material fact precluded summary judgment on the fair-use defense.
•  October 15, 2024: Oral argument is held before the Honorable Rebecca W. Langford. Catherine Bloom appears on behalf of Redstone and presents oral argument. Daniel Hargrove appears on behalf of Luminos.
G. Disposition.  
•  October 22, 2024: The Court issues its Order granting Redstone's Motion for Summary Judgment. The Court conducts a thorough analysis of all four fair-use factors under 17 U.S.C. § 107 and finds that each factor weighs in favor of fair use (Factors 1, 3, and 4 strongly; Factor 2 slightly against but not dispositive). The Court additionally notes the strength of the independent-creation evidence and the applicability of the scènes à faire doctrine. The case is dismissed with prejudice.
Throughout the case, discovery disputes were handled by Magistrate Judge the Honorable David Chen, who presided over several informal discovery conferences and resolved objections related to the scope of document production and deposition questioning. No sanctions or adverse rulings were entered against Redstone in connection with any discovery matter.
V. SUMMARY OF THE COURT'S RULING
A. Fair-Use Analysis Under 17 U.S.C. § 107
The Court's October 22, 2024 Order analyzed each of the four statutory fair-use factors set forth in 17 U.S.C. § 107 and concluded that, on the undisputed record before it, the balance of factors weighed decisively in favor of Redstone.
Factor 1 — Purpose and Character of the Use.  The Court examined whether Redstone's use of any allegedly similar visual elements was "transformative" — that is, whether the new work "adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message." Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994). The Court held that Ironclad Dominion is "highly transformative" in its treatment of the visual motifs at issue. Specifically, the Court found that Ironclad Dominion repurposes generic fantasy design motifs — such as crystalline environments, medieval armor silhouettes, and stylized UI iconography — into a wholly original mechanized-steampunk context, integrated with an original narrative framework, original game mechanics, and a fundamentally different aesthetic vision. The Court noted that the two games employ the shared motifs for "entirely different expressive purposes" and that any arguable similarities in individual assets are overwhelmed by the transformative context in which they are deployed.
The Court further noted that Ironclad Dominion is a commercial product, which ordinarily weighs against fair use, but emphasized that the Supreme Court has recognized that "nearly all of the illustrative uses listed in the preamble paragraph of § 107 . . . are generally conducted for profit," Campbell, 510 U.S. at 584, and that the commercial nature of the use does not defeat a finding of transformativeness.
This factor weighed strongly in Redstone's favor.
Factor 2 — Nature of the Copyrighted Work.  The Court acknowledged that Shardfall Chronicles is a creative work — a video game involving significant artistic expression — and that creative works are "closer to the core of intended copyright protection" than factual or functional works. Campbell, 510 U.S. at 586. Accordingly, the Court found that this factor weighed slightly in Luminos's favor.
However, the Court expressly noted that "this factor has rarely been found dispositive in the fair-use analysis" and that it carries limited weight where, as here, the defendant's use is highly transformative. The Court observed that the second factor's significance is further diminished where the elements at issue include standard genre conventions that blur the line between protectable creative expression and unprotectable ideas and common tropes.
This factor weighed slightly in Luminos's favor, but the Court deemed it not dispositive.
Factor 3 — Amount and Substantiality of the Portion Used.  The Court examined both the quantitative and qualitative extent of any overlap between the challenged assets. Central to the Court's analysis was Dr. Ingrid Lautner's pixel-comparison analysis, which the Court found to be "well-supported, methodologically rigorous, and persuasive."
Dr. Lautner's analysis demonstrated the following:
The Court found that the quantitative overlap between the challenged assets in the two games was "de minimis relative to each work's totality." The Court noted that Ironclad Dominion contains thousands of individual visual assets, and that the 37 challenged assets — even taken at their highest alleged similarity — constitute a vanishingly small fraction of the game's total visual content. Moreover, the Court found that none of the 37 challenged assets constituted the "heart" or most qualitatively significant portion of Shardfall Chronicles, as Luminos's own testimony acknowledged that the game's narrative, gameplay mechanics, and overall art direction are distinct from its individual component assets.
The Court contrasted Dr. Lautner's quantitative methodology with Dr. Yates's qualitative approach and found Dr. Yates's analysis "insufficiently rigorous to create a genuine dispute of material fact," noting that Dr. Yates failed to employ standard pixel-comparison tools and relied instead on subjective visual impressions.
This factor weighed in Redstone's favor.
Factor 4 — Effect on the Market for the Copyrighted Work.  The Court examined whether Redstone's allegedly infringing use caused or was likely to cause market harm to Shardfall Chronicles. The Court relied heavily on the rebuttal damages report prepared by Evergreen Valuation Group LLC, led by Dr. Sandra Chu.
Dr. Chu's report demonstrated two key findings that the Court found dispositive on this factor:
1.  Non-Overlapping Market Segments: Ironclad Dominion and Shardfall Chronicles occupy fundamentally different market segments. Ironclad Dominion is a AAA multiplayer online RPG marketed to the mass-market console and PC gaming audience, with a premium price point and live-service revenue model. Shardfall Chronicles is a single-player indie RPG marketed to a niche audience of indie gaming enthusiasts, sold at a lower price point without ongoing service revenue. The Court found that the two products "do not compete for the same consumer dollar" and that a reasonable consumer would not view one as a substitute for the other.
2.  Absence of Actual Market Harm: Contrary to Luminos's market-harm theory, Shardfall Chronicles unit sales actually increased by 18% in the six months following Ironclad Dominion's release — from approximately 8,400 units per month to approximately 9,912 units per month. The Court noted that this sales increase was likely attributable, at least in part, to the increased visibility that Shardfall Chronicles received from public commentary and social media discussions comparing the two games. In any event, the Court concluded that Luminos had failed to demonstrate any actual or likely market harm resulting from Redstone's allegedly infringing use.
This factor weighed strongly in Redstone's favor.
B. Court's Conclusion
Having analyzed all four statutory factors, the Court concluded that the undisputed factual record established fair use as a matter of law. Three of the four factors (Factors 1, 3, and 4) weighed in Redstone's favor — Factors 1 and 4 strongly so — while Factor 2 weighed only slightly in Luminos's favor and was not dispositive. The Court emphasized that the fair-use analysis requires a holistic weighing of all factors and that no single factor is determinative.
In addition to its fair-use holding, the Court noted the strength of two additional grounds supporting judgment in Redstone's favor:
•  Independent Creation: The ironclad-main Git repository's first commit, dated February 12, 2020, predated the release of Shardfall Chronicles by more than 13 months. The repository's 14,208 commits, verified by Brindoval Forensic Consulting as authentic and unaltered, provided compelling evidence that the challenged assets were independently created without reference to Luminos's work. The Court stated that the independent-creation evidence "standing alone, would raise serious doubt as to the viability of Luminos's infringement theory."
•  Scènes à Faire Doctrine: The Court noted that many of the challenged elements — crystalline cave textures, radial menu interfaces, medieval plate-armor silhouettes — are standard visual conventions of the fantasy RPG genre that are "indispensable, or at least standard, in the treatment" of such works, and therefore are not protectable under copyright. Cain v. Universal Pictures Co., 47 F. Supp. 1013, 1017 (S.D. Cal. 1942).
The Court granted Redstone's Motion for Summary Judgment in its entirety and dismissed the case with prejudice.
VI. FINANCIAL SUMMARY — DEFENSE COSTS
A. Calderwood & Harkness LLP Fees
The following table summarizes the professional fees incurred by Calderwood & Harkness LLP in connection with the defense of this matter:
The distribution of hours across the litigation phases reflects the complexity and volume of the discovery process (which accounted for the largest share of attorney and paralegal time), the intensive expert-witness coordination and review, and the substantial investment in dispositive motion practice. Partner time was concentrated on strategic decision-making, key depositions, and the preparation and presentation of the summary judgment motion and oral argument.
B. Third-Party and Vendor Costs
The following table summarizes costs incurred by third-party counsel, consultants, and vendors in connection with this matter:
C. Total Defense Costs
D. Insurance Coverage and Client Out-of-Pocket Exposure
All defense costs incurred in this matter were covered by Pinnacle Mutual Insurance Co. under Policy No. PML-IP-2023-08841, subject to the $5,000 per-claim deductible. The intellectual property litigation sub-limit under the policy is $15,000,000 per occurrence, and total defense costs of $1,657,750.00 were well within the available coverage.
Pinnacle Mutual processed and reimbursed all invoices submitted under Claim No. PML-CLM-2024-3392 throughout the course of the litigation, and no disputes arose regarding coverage, billing rates, or the reasonableness of any fees or costs.
Redstone's net out-of-pocket cost for the defense of this matter was $5,000.00 (representing the per-claim deductible only). No additional financial exposure remains.
VII. APPEAL DEADLINE ANALYSIS
Under Federal Rule of Appellate Procedure 4(a)(1)(A), a party seeking to appeal a final judgment in a civil case must file a notice of appeal with the clerk of the district court within 30 days after entry of the judgment or order appealed from. The Court's Order granting Redstone's Motion for Summary Judgment and dismissing the case with prejudice was entered on October 22, 2024. Accordingly, the deadline for Luminos to file a notice of appeal to the United States Court of Appeals for the Ninth Circuit is November 21, 2024.
As of the date of this memorandum, no notice of appeal has been filed by Luminos Interactive LLC or its counsel, Hargrove, Tanaka & Whitmore LLP. Additionally, no post-judgment motions have been filed under Rule 59 (Motion to Alter or Amend a Judgment) or Rule 60 (Relief from a Judgment or Order) of the Federal Rules of Civil Procedure. Had any such motion been timely filed, it would have tolled the appeal deadline under Federal Rule of Appellate Procedure 4(a)(4)(A) until the entry of the order disposing of the last such remaining motion. Because no such motion has been filed, the appeal deadline remains November 21, 2024, and is not subject to tolling.
The case was dismissed with prejudice, which means that the judgment carries full res judicata effect and precludes any future relitigation of the same claims or any claims arising out of the same transaction or occurrence between the same parties.
I recommend that Calderwood & Harkness continue to monitor the docket in Case No. 2:24-cv-00587-RWL through the expiration of the appeal deadline on November 21, 2024. If no notice of appeal is filed by that date, the judgment will become final and nonappealable, and the matter can be confirmed for formal closure at that time.
In the event that Luminos does file a notice of appeal, I will immediately notify Catherine Bloom, Alan Ngo, and Priya Venkatesh, and will prepare a preliminary assessment of the appellate issues and the likelihood of success on appeal.
VIII. DOCUMENT RETENTION AND FILE MANAGEMENT
A. File Retention Schedule
In accordance with Calderwood & Harkness LLP's standard document retention policy and the terms of the engagement letter executed by Redstone Gaming Corp. on April 3, 2024, all client files associated with Matter No. 1033-00004 will be retained for a minimum period of seven (7) years from the date of formal matter closure. Upon expiration of the retention period, the firm will notify the Client and seek instructions regarding the disposition of the files, including the option of return to the Client or destruction in accordance with applicable ethical obligations.
All electronic files — including pleadings, correspondence, attorney work product, discovery materials, expert reports, and internal communications — have been archived within the firm's document management system under Matter No. 1033-00004. Electronic files are maintained on secure, encrypted servers with redundant backup in accordance with the firm's information security policies.
Hard-copy exhibits, deposition transcripts, and any physical materials received during the course of the litigation will be stored in the firm's off-site records storage facility in accordance with the firm's records management protocol. An inventory of all hard-copy materials has been prepared and is maintained in the electronic matter file.
B. Key Documents for Permanent Retention
The following categories of documents have been identified for permanent retention within the matter file, irrespective of the general retention schedule, due to their significance to the outcome of the litigation and their potential relevance to any future proceedings:
1.  The Court's October 22, 2024 Order granting Redstone's Motion for Summary Judgment and dismissing the case with prejudice.
2.  All filed pleadings and briefs, including the Complaint, Answer and Affirmative Defenses, Motion for Summary Judgment and supporting memorandum, Opposition, Reply, and all supporting declarations and exhibits.
3.  Expert reports of Dr. Ingrid Lautner (initial report and rebuttal report, dated August 19, 2024 and September 3, 2024, respectively) and Dr. Calvin Yates (initial report dated August 19, 2024).
4.  Brindoval Forensic Consulting LLC's metadata verification report, documenting the analysis and verification of the ironclad-main Git repository.
5.  Evergreen Valuation Group LLC's rebuttal damages report, including the market-segment analysis and the Shardfall Chronicles sales-trend data.
6.  Deposition transcripts of Tobias Crane (July 22, 2024), Elara Whitfield (July 29, 2024), Jordan Kessler (August 5, 2024), and Seo-Yeon Park (August 12, 2024).
7.  Insurance correspondence and coverage confirmations with Pinnacle Mutual Insurance Co., including the tender letter dated April 8, 2024, coverage acceptance, and all claims correspondence under Claim No. PML-CLM-2024-3392.
C. Privilege and Work-Product Materials
All attorney work-product memoranda, litigation strategy documents, internal communications, mental impressions, and legal analyses prepared in connection with this matter remain protected by the attorney-client privilege and the attorney work-product doctrine. No waiver of privilege occurred during the course of the litigation, whether through inadvertent disclosure, at-issue waiver, or otherwise. The privilege log maintained during the discovery phase documented all withheld materials and was not challenged by Luminos.
Upon formal closure of the matter, all privileged and work-product materials will continue to be maintained under the firm's standard confidentiality protocols and will not be disclosed to any person outside the firm without the prior written consent of the Responsible Partner and, where required, the Client.
IX. RECOMMENDED NEXT STEPS
A. Client Notification
I recommend that Calderwood & Harkness LLP send a formal outcome letter to Priya Venkatesh, General Counsel, Redstone Gaming Corp., at 4100 Obsidian Tower Boulevard, Suite 2200, Las Vegas, Nevada 89109. The letter should confirm the dismissal of Case No. 2:24-cv-00587-RWL with prejudice on fair-use grounds, summarize the Court's ruling and the favorable result achieved, provide final defense cost figures, and advise the Client regarding the appeal deadline. A draft of this letter will be circulated to Catherine Bloom and Alan Ngo for review and approval prior to transmittal.
B. Insurance Carrier Notification
I recommend sending a final disposition notice to Franklin Teague, Claims Adjuster, Pinnacle Mutual Insurance Co., at 200 Commerce Drive, Hartford, Connecticut 06103. The notice should confirm the final outcome of the litigation, provide a copy of the Court's October 22, 2024 Order, report the final total defense costs of $1,657,750.00, and request formal closure of Claim No. PML-CLM-2024-3392. Any remaining outstanding invoices should be identified for final processing prior to claim closure.
C. Local Counsel Notification
I recommend notifying Patricia Thorngate at Thorngate & Associates, PC of the matter closure and coordinating any remaining local filings or administrative matters in the District of Nevada. Ms. Thorngate should be asked to confirm that no outstanding local obligations exist, including any state bar or local court administrative requirements.
D. Vendor Notifications
I recommend confirming final invoicing from all third-party vendors engaged in connection with this matter:
•  Brindoval Forensic Consulting LLC — Confirm that all work has been completed and that the final invoice has been received and processed.
•  Dr. Ingrid Lautner — Confirm that all outstanding fees and expenses have been invoiced and processed.
•  Evergreen Valuation Group LLC — Confirm that all work has been completed and that the final invoice has been received and processed.
All final vendor invoices should be submitted to Pinnacle Mutual Insurance Co. for reimbursement under Claim No. PML-CLM-2024-3392 prior to closure of the insurance claim.
E. Docket Monitoring
I recommend that Calderwood & Harkness LLP continue monitoring the docket in Case No. 2:24-cv-00587-RWL through the appeal deadline of November 21, 2024. Our automated docket monitoring service has been configured to provide real-time alerts for any new filings in this case. If no notice of appeal is filed by Luminos or Hargrove, Tanaka & Whitmore LLP by November 21, 2024, I will circulate a final confirmation memorandum and recommend formal closure.
F. File Closure
Upon expiration of the appeal period on November 21, 2024, without the filing of a notice of appeal, I recommend the following file-closure actions:
1.  Formally close Matter No. 1033-00004 in the firm's matter management system, updating the matter status to "Closed — Favorable Disposition."
2.  Generate a final billing statement reflecting all time entries and costs incurred throughout the engagement, including any final entries for matter-closure activities.
3.  Reconcile all time and costs against Pinnacle Mutual Insurance Co. reimbursements to confirm that all amounts have been properly billed, submitted, and reimbursed, and that Redstone's net out-of-pocket exposure is limited to the $5,000 deductible.
4.  Archive all electronic and hard-copy files in accordance with the retention schedule described in Section VIII above.
X. CONCLUSION
Matter No. 1033-00004, Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL, has been resolved in a manner that represents a complete and unqualified defense victory for our client, Redstone Gaming Corp.
The case was resolved on summary judgment without the need for trial. The Court's October 22, 2024 Order granted Redstone's Motion for Summary Judgment on fair-use grounds under 17 U.S.C. § 107, with the Court finding that three of the four statutory fair-use factors weighed in Redstone's favor (Factors 1 and 4 strongly, Factor 3 moderately), while the sole factor weighing against Redstone (Factor 2) was not dispositive. The Court additionally recognized the strength of Redstone's independent-creation evidence and the applicability of the scènes à faire doctrine to many of the challenged visual elements.
Luminos Interactive LLC's claims for $28.5 million in actual damages, injunctive relief, statutory damages, and attorney's fees have been fully dismissed with prejudice, and the judgment carries res judicata effect precluding any future relitigation of the same claims.
Redstone's net financial exposure in this matter has been limited to $5,000 — the per-claim deductible under its intellectual property litigation insurance policy with Pinnacle Mutual Insurance Co. Total defense costs of $1,657,750.00 were substantially covered by Pinnacle Mutual under Policy No. PML-IP-2023-08841, Claim No. PML-CLM-2024-3392.
No outstanding issues remain. I recommend formal file closure upon the expiration of the thirty-day appeal period on November 21, 2024, assuming no notice of appeal is filed. In the interim, the docket will continue to be monitored as described in this memorandum.
I am available to discuss any aspect of this memorandum at your convenience and will proceed with the recommended next steps upon your approval.
Respectfully submitted,
Omar Siddiqui Senior Associate, intellectual Property Calderwood & Harkness LLP 600 South Grand Avenue, Suite 4400 Los Angeles, California 90071 Telephone: (213) 555-4200
Email: o.siddiqui@calderwoodharkness.com
Matter No. 1033-00004
Date: October 22, 2024
cc: Christy Bauer, Working Associate, intellectual Property, Calderwood & Harkness LLP
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT. This memorandum has been prepared in anticipation of litigation and for the purpose of providing legal advice. It is protected from disclosure by the attorney-client privilege and the attorney work-product doctrine. Any unauthorized disclosure, copying, or distribution of this memorandum or its contents is strictly prohibited.
From: | Omar Siddiqui, Senior Associate, intellectual Property, Calderwood & Harkness LLP
To: | Catherine Bloom, Responsible Partner, intellectual Property, Calderwood & Harkness LLP
Alan Ngo, Billing Partner, intellectual Property, Calderwood & Harkness LLP
Date: | October 22, 2024
Re: | Matter Closing Memorandum — Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL (U.S. District Court for the District of Nevada)
Matter No.: | 1033-00004
Client: | Redstone Gaming Corp. (Nasdaq: RDST)
Client Contact: | Priya Venkatesh, General Counsel
Detail | Information
Carrier | Pinnacle Mutual Insurance Co.
Address | 200 Commerce Drive, Hartford, CT 06103
Claims Adjuster | Franklin Teague
Policy No. | PML-IP-2023-08841
Claim No. | PML-CLM-2024-3392
IP Litigation Sub-Limit | $15,000,000 per occurrence
Deductible | $5,000 per claim
Metric | Finding
Total challenged assets | 37
Assets with similarity index above 40% | 4
Maximum similarity index observed | 52%
Assets with similarity index below 25% | 28
Timekeeper | Role | Rate ($/hr) | Hours | Total Fees
Catherine Bloom | Partner | $1,150 | 185.0 | $212,750.00
Alan Ngo | Partner | $1,100 | 72.0 | $79,200.00
Omar Siddiqui | Senior Associate | $725 | 680.0 | $493,000.00
Christy Bauer | Associate | $575 | 520.0 | $299,000.00
Paralegal / E-discovery Support | Staff (blended) | $295 | 680.0 | $200,700.00
Total Hours: 2,137.0 | Total C&H Fees: $1,284,650.00
Vendor | Description | Total Cost
Thorngate & Associates, PC | Local Nevada counsel services | $87,400.00
Brindoval Forensic Consulting LLC | Digital forensics / metadata analysis of ironclad-main Git repository | $142,500.00
Dr. Ingrid Lautner | Expert witness (100 hours × $650/hr) | $65,000.00
Evergreen Valuation Group LLC | Rebuttal damages analysis | $78,200.00
Total Third-Party Costs: | $373,100.00
Category | Amount
Calderwood & Harkness LLP Fees | $1,284,650.00
Thorngate & Associates, PC | $87,400.00
Brindoval Forensic Consulting LLC | $142,500.00
Dr. Ingrid Lautner | $65,000.00
Evergreen Valuation Group LLC | $78,200.00
Grand Total Defense Costs | $1,657,750.00