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The Long legal battle between Interplay and Bethesda over the rights of the Fallout IP has been settled out of court for $2million.
Both sides are ordered to pay their own legal costs in the deal. Interplay retains the publishing rights to Fallout 1, 2 and Tactics 
until December 31, 2013 - when they will also transfer ownership to Bethesda.

"While we strongly believe in the merits of our suits, we are pleased to avoid the distraction and expense of litigation while completely resolving all claims to the Fallout IP," said Robert Altman, CEO of Bethesda parent Zenimax. "Fallout is an important property of ZeniMax and we are now able to develop future Fallout titles for our fans without third party involvement or the overhang of others' legal claims."

The legal battle first began in earnest in 2009, two years after the 2007 deal which saw Bethesda buy the publishing rights for the IP.

Bethesda then sued Interplay for allegedly breaching the terms of the 2007 agreement by publishing the Fallout Trilogy pack, containing Fallout 1, 2 and Tactics, claiming that the company should have sought its consultation on packaging and marketing to avoid confusion with the recently released Fallout 3 which led to many customers complaining about mix-matched developers.

At the same time Interplay was asked to work on and develop an MMO with the Fallout IP under the stipulations that they could raise $30million to fund the game within a two year period, and have started on an alpha build of development; these conditions were not met.

Interplay retained its rights over the first three games in that case, but the issues over an MMO continued to be contested in and out of court for the next three years.

In 2010, Interplay president Eric Caen claimed that Bethesda could have bought the rights to the entire IP for $50 million at the time of the deal, but the publisher had refused. Caen also insinuated that Bethesda had expected to obtain the rights through litigation all along.

Now to summarize; Interplay only has the rights to their original games until 2013 and then they'll surrender the rights to Bethesda. Bethesda now has the reigns over the MMO and the proverbial ball is in their court.