9. Silicon Knights Vs. Epic Games
The chain of events that led to the closure of development studio Silicon Knights can only be described as a perfect storm of horribleness and hilarity (if you buy into that whole tragedy plus time thing.)
It all started with Too Human, an action RPG being developed by SK as a PlayStation exclusive in 1999, then a GameCube exclusive in 2000, and then as an Xbox 360 exclusive in 2005. It finally arrived in 2008.
On top of the promises of exclusivity to every major platform manufacturer, Silicon Knights also entered a contract with Epic Games to use the Unreal Engine for all future titles.
In 2007 SK sued Epic for breach of contract, claiming that the engine was unfinished. Epic then counter-sued, claiming, essentially, that SK knew what they were getting into in regards to the state of the engine. In one of the most hilarious turns of karma, it was discovered during the trial that SK had plagiarized a ton of copyrighted Epic code.
Epic not only defeated SK's suit, but won their counter-suit and were entitled to several million dollars from SK. SK appealed the verdict to a higher court, where Epic won again, entitling them to double the original amount awarded.
You gotta know when to fold 'em.