You may recall that in November of last year, U.S. District Court for the Southern District of New York granted preliminary approval of a settlement of several class action suits against Take-Two. TTWO expected then to pay out up to $2.75 million for the settlement, pending Court approval.

Turns out that few actually filed claims. On July 31, the Court said that "the plaintiffs could no longer meet their burden of showing that the case could proceed on the proposed class basis" according to an SEC filing.

Take-Two opts not to weigh in on whether an appeal is likely in the filing, but when a million bucks is offered and folks don't bite — only $30,000 in claims were filed — we'd have a hard time believing that one is in the cards. The attorneys involved already got their paycheck actually haven't yet been paid, at least on the plaintiff side. Makes me feel that much better about never completing "The Guide To Spending Your 'Hot Coffee' Settlement."

Update: Ted Frank from Overlawyered wrote in to clear some things up for us. He writes: "The plaintiffs' attorneys have not gotten their paycheck. My objection was premised on the grounds that the court should not approve a settlement that paid the attorneys so much more than what the class received; when the court rejected the settlement, it meant there was no court approval for a payment to the plaintiffs' attorneys."

Take-Two must cover over a million dollars in legal fees and has agreed to a hefty charitable donation as part of the settlement, but they'll pay out just $30,000 in resolving claims with consumers. The "benefits" to consumers ranged from $5 to $35 US, with some claimants getting a decaffeinated copy of San Andreas.

Unsurprisingly, another lawyer has poked his nose into the settlement, claiming that the lawsuit has no merit. That claim is partly based on the fact that so few offended parties wanted to experience the "Hot Coffee" healing power of cash.

Adding weight to the argument that the suit has no merit, is that it appears that some of those deposed were clueless about the game's content to begin with. Killing? Well known. But stealing? In Grand Theft Auto? Who knew?!

Anyone out there file a claim? We'd like to know!

Hidden Sex Scenes Draw Ho-Hum, Except From Lawyers [New York Times - thanks, Michael!]

We never anticipated how this thing was going to be blown out of proportion by the mainstream media and the politicians...

I'm still proud of finding and uncovering the [Hot Coffee] scenes - because of all the work and research it took... When I look back at it, I think [Rockstar] should have reacted differently, but I don't hold a grudge at all.

OK, he didn't actually say that last part.

Hot Coffee Rewind: Famed Dutch Modder Talks to EGM [GamePolitics]

• Grand Theft Auto: San Andreas First Edition Disc - Replacement Disc
• Detailed Store Receipt - Cash payment up to $35.00
• General Credit Card Statement or Check - Cash payment up to $17.50
• Disc/Purchase Details - Cash payment up to $10.00
• No Disc/Purchase Details - Cash payment up to $5.00

Gaming Steve noted that the masses are well aware of the settlement opportunities, now that ads are running in magazines like People. Everyone involved has until May 16 to grab their cash. Good luck!

GTA Class Action Settlement [via Gaming Steve]

The lawsuit against Take-Two is still pending, but should the United States District Court for the Southern District of New York agree to the settlement, claims against the company will be dismissed "without any admission of liability or wrongdoing by Take-Two or Rockstar."

The publisher says that it will pay out between $1.025 million and $2.75 million in settlement benefits, which range from an edited copy of GTA: San Andreas to a cash payment up to $35 for those who can provide proof of purchase of the game from before July 20, 2005. There are, of course, stipulations to the proposed settlement, the details of which are in the full press release below.

Take-Two Interactive Software, Inc. Announces Preliminary Settlement of Consumer Class Action

New York, NY - November 8, 2007 - Take-Two Interactive Software, Inc. (NASDAQ:TTWO) today announced the settlement of all consumer class action lawsuits pending in the United States against the Company and its subsidiary Rockstar Games, relating to a third-party program called the "Hot Coffee Modification" that could be used by consumers to alter the content of the Grand Theft Auto: San Andreas video game. If the proposed settlement receives preliminary and final approval from the United States District Court for the Southern District of New York, all claims in these lawsuits will be dismissed without any admission of liability or wrongdoing by Take-Two or Rockstar.

Under the terms of the settlement, class members will be able to claim benefits if they swear that they: (a) bought a copy of Grand Theft Auto: San Andreas before July 20, 2005; (b) were offended and upset by the ability of consumers to modify and alter the game's content using the third-party Hot Coffee modification; (c ) would not have bought the game had they known that consumers could modify and alter the game's content using the third-party Hot Coffee modification; and (d) would have returned the game, upon learning the game could be modified and altered, if they thought this possible. Settlement class members who attest to these facts may apply for benefits that range from an exchange of the game disk for an edited copy of Grand Theft Auto: San Andreas to a cash payment of up to $35 for consumers who submit detailed proofs of purchase.

The actual value of all cash payments under the settlement will depend on the number of class members that apply for benefits. Take-Two has committed to spend at least $1.025 million on settlement benefits, and the settlement generally caps the defendants' out-of-pocket costs at no more than $2.75 million, in addition to the costs of providing notice to class members and paying a fee to plaintiffs' counsel. The Company previously established a reserve sufficient to substantially cover the expected cost of the settlement and related expenses. The full settlement terms will be described in the parties' Settlement Agreement, which the plaintiffs are expected to file with the Court in mid-November when they seek preliminary approval for the settlement.

"If the case had continued, we believe the court would have agreed that Take-Two was not liable for consumers acting independently to modify their games with third-party hardware and software to access normally inaccessible content," said Ben Feder, Chief Executive Officer of Take-Two. "Nonetheless, we believe it is in the best interest of the Company to avoid protracted and costly litigation to prove our case and to finally put this matter behind us."

While the flap over the Forza Motorsport 2 content may still be too young, it raises some interesting questions. Does the ESRB need to extend its warning to consumers beyond the "game experience may change during online play" splash screen? It would be much easier for a gamer to come across content that causes offense in a game like Forza 2 than to witness the unfinished "adults only" Hot Coffee mod material.

I would tend to agree that games that have the ability to see user created content added to the game and its online experience need to be more clearly labeled by the ESRB, at the very least in attempts to better inform consumers and to protect the industry's developers. What do you think about new ratings for games that are more open to user created content?

Call the ESRB! [Curmudgeon Gamer]
Why wouldn't the ESRB act on Forza? [Cathode Tan]

I swear we posted this before, but asking several fellow writers and digging through the site, I've decided I'm actually just losing my mind.

UGO found a Grand Theft Auto IV coffee cup while walking past Rockstar's New York office recently. Very cool, but I hear you have to hack the cup to actually use it, and that Rockstar denies there was ever any Hot Coffee in the cup once you take a sip. Brian Crecente

Attack of the Branding! GTA IV Coffee? [D-Pad]

Even though the title was released in the States back in 2004, Capcom is finally publishing Rockstar's controversial Grand Theft Auto: San Andreas on January 25th. And they've got the launch party to prove it. Just check out after the jump what the festivities held at Shibuya's Club Asia for this 18-years-old-and-up-game:

• Girls with fake Peter Moore-esque fake GTA tattoos.
• A BMX stunt show. How 80's!
• Caution tape and salarymen.
• Hoodies. Yes, hoodies.
• A Japanese hip-hop star (the country's first rapper at that) with shameful sweaty pits. Wear one shirt, dude!
• Blind-folded AND seated basketball dribbling with traditional drum accompaniment.
• Non alcohol drinks with bad pun names like "GTA Coke. And I quote: "The recipe is a 'buzz' and coke cocktail." So clever.

Capcom GTA Event [Watch Impress]

You know, I've done just about every single one of these, minus the Strider hack (news to me!), despite the fact that I had the cart and Altered Beast back in the day. Classic stuff, but I know they're missing something. What is it? Help me remember my classic cheats, Kotaku retro elite readership! Michael McWhertor

Reuters is reporting that a judge has denied Take Two Interactive's motion to have portions of lawsuits filed against them dismissed, which could make it possible for the Grand Theft Auto San Andreas publisher to have a class action lawsuit against them see court. From Reuters:

The lawsuit, filed in July 2005 seeking class-action status, said Take-Two's alleged misconduct violated consumer protection laws in all 50 US states and the District of Columbia. Since then a number of cases making the same claim were consolidated in Manhattan federal court.

Take-Two and its subsidiary, Rockstar Games, had argued in its motion to dismiss parts of the lawsuit that the plaintiffs could only file claims in the states where they resided, not all 50 states.

Should a class action suit go forward, the judge said she would reconsider.

Not sure if you heard, but GTA:SA was modified by users to unlock intentionally hidden scenes of two robotic, polygonal avatars saying things and moving around (in a fashion some people who may not have actually ever had sexual intercourse to say that the characters were behaving) in a sexually explicit manner. Michael McWhertor

Early last month, the FTC announced that they were putting the company on notice that any future misrepresentation of video game ratings or content descriptors would result in a xxx fine. And that the company needed to implement a system to "ensure that all game content is reviewed in connection with submissions to ratings authorities."

While the FTC ruling was announced last month the public, and in particular politicians, had 30 days to comment on the action, or inaction as some naysayers put it, and the FTC could have changed its mind. Now that the 30 day period has passed the decision is set in stone.

Take-Two Interactive also pointed out that the consent order and agreement was unanimously approved by the commission.

Paul Eibeler, President and Chief Executive Officer, stated, "We are extremely pleased that the FTC has concluded its very thorough investigation, and that the matter has been resolved. We recognize the importance of maintaining public confidence in the Entertainment Software Rating Board (ESRB) rating system and helping the ESRB educate parents and consumers about the rating system. We look forward to putting this behind us and focusing on what we do best - creating video games."

It's good to see that politicians weren't able to influence the decision of the FTC following their investigaiton. It even managed to withstand congressional hearings. Hit the jump for the official press release. Brian Crecente

Take-Two Interactive Software, Inc. (NASDAQ: TTWO) announced today that following the 30-day period for public comment, the Federal Trade Commission (FTC) has unanimously approved the Consent Order and Agreement with Take-Two and its wholly-owned publishing label Rockstar Games. All outstanding matters pending before the FTC have been settled and no penalties or fines have been assessed. Among other things, the Consent Order provides that the Company shall not misrepresent a video game's ratings or content descriptors and that the Company shall implement a system to ensure that all game content is reviewed in connection with submissions to ratings authorities.

Paul Eibeler, President and Chief Executive Officer, stated, "We are extremely pleased that the FTC has concluded its very thorough investigation, and that the matter has been resolved. We recognize the importance of maintaining public confidence in the Entertainment Software Rating Board (ESRB) rating system and helping the ESRB educate parents and consumers about the rating system. We look forward to putting this behind us and focusing on what we do best - creating video games."

Today Thompson decided to drop Edward C. Johnson, III, chairman of Fidelity Investments, a friendly note to try and convince the guy to drop the company's Take-Two shares. For those of you who don't follow who owns what out there (and that typically includes me), Fidelity owns more than 20 percent of the game developer.

In his letter, Thompson continues to insist that he "prepared Senator Clinton" for her Grand Theft Auto bashing press conference and goes on to say he knows a lot of secret, company-killing stuff about Take-Two and the SEC investigation.

He never really gets around to spilling the beans in the letter, but does hint that he was partially responsible for the informal SEC investigation and that he's helping out the lawyers involved in what could become a class-action lawsuit against the company.

Thompson claims the key to the SEC investigation can be found in the company's 10-k filing last month. He also tries to rope the company's outside general counsel, Blank Rome, into the whole mess as well as Barbara Kaczynski, Take-Two's former audit chair.

Here's the kicker:

In short, without herein divulging all I know, I'll say this: Somebody at Fidelity needs to talk to me immediately if not sooner. You all owe that to your investors.

I guess Thompson figures if he can't convince politicians or the media that Take-Two is the antichrist, he can at least try to dry up their funds. I tried figuring out the 10-K filed by Take-Two, but I'm an embicile. If you feel like you will fare better, check it out for yourself, just make sure to report back your findings. Hit the jump for Jack's full letter.
Brian Crecente

July 13, 2006

Edward C. Johnson, III
Chairman
Fidelity Investments (FMR)

Re: Take-Two Interactive Software, Inc. (TTWO on NASDAQ)

Dear Mr. Johnson:

As you know, Fidelity reportedly owns more than 20% of the above company's stock. In one year that stock has fallen in value from $28 to $9, primarily because of the "Hot Coffee" scandal which broke because of Senator Hillary Clinton's July 2005 press conference. I prepared Senator Clinton for that news conference, and here is a graphic depiction of the subsequent stock price tumble:

I was on CBS's 60 Minutes twice last year regarding Take-Two, and the August 2005 issue of Reader's Digest reported my efforts against this company. They didn't report a tenth of what I know.

Mr. Johnson, I know some facts about Take-Two that your company apparently does not know. The latest SEC investigation of Take-Two, announced Monday, comes as no surprise to me. It may come as a surprise to you and your analysts, however, that there may be some very significant problems with certain information in Take-Two's 10-K filed with the SEC months ago. I identified those potential problems immediately and shared them with the SEC. I also shared them with the lawyers who are seeking class action status for shareholders suing Take-Two.

One of the potential problems we have here (more accurately, that Fidelity has here, in my opinion) is the fact that the outside general counsel to Take-Two is the Philadelphia law firm of Blank Rome, which is also Take-Two's registered lobbyist on Capitol Hill. What I can tell you about Blank Rome and other aspects of Take-Two's problems might help explain why Take-Two's audit chair, Barbara Kaczynski, quit the Take-Two board, hired a top-notch criminal attorney, and wrote the SEC about Take-Two's alleged cover-up by senior management.

In short, without herein divulging all I know, I'll say this: Somebody at Fidelity needs to talk to me immediately if not sooner. You all owe that to your investors.

Regards, Jack Thompson

Jack Thompson, Attorney

Wedbush Morgan analyst Michael Pachter is waving his hands around to shoo off investors after the subpoenas.

We note that grand jury subpoenas are founded in criminal investigations... As such, we believe that it is likely that one or more Take-Two employees may be subject to a potential criminal indictment.

Intriguing. You'd think that video game publishers couldn't be indicted for failure to subscribe to a voluntary ratings system, but luckily, someone's thinking of the children. Isn't it interesting, though, that employees of a games publisher can face criminal indictment for including hidden scenes in a game that are far tamer than the ones pornographers film and sell with impugnity? And can someone explain to me how a kid walking in and buying a copy of Grand Theft Auto is more corrupting than them walking into a bookstore and buying a volume by everyone's favorite "I punched her in the stomach, then fucked her" novelist, Henry Miller?

No need to answer that rhetorical questions: these punk kids today would never be caught dead reading a book. Florian Eckhardt

Take-Two Could Face Criminal Indictment, Says Analyst [GamesIndustry]

We broke the news yesterday of the Manhattan District Attorney's Office issuing a subpoenea to Take-Two as part of a grand jury investigation into Hot Coffee Gate. Today, investors showed their unhappiness, with the company's stock plummeting nearly 20 percent since yesterday's close.

According to this chart, while the stock opened at a dismal 9.85 a share, it has already rebounded to a still dismal 10.36. There's also a HUGE spike in volume. The three month average is 1.7 million or so, and today's volume has already hit 8.2 million.

Say it with me. Buy, Sell, Buy, Sell! Brian Crecente

Take-Two [Yahoo Finance]

Take-Two Interactive just sent word that last week they received grand jury subpoenas from the District Attorney of the County of New York requesting production of documents surrounding the company's knowledge of the hidden sex scenes in Grand Theft Auto: San Andreas.

From the release:

Take-Two Interactive Software, Inc. (NASDAQ:TTWO) today announced that on June 19, 2006, the Company received grand jury subpoenas issued by the District Attorney of the County of New York requesting production of documents, covering various periods beginning on October 1, 2001, including those relating to: the knowledge of the Company's officers and directors regarding the creation, inclusion and programming of hidden scenes (commonly referred to as "hot coffee") in Grand Theft Auto: San Andreas, the submission of Grand Theft Auto: San Andreas to the Entertainment Software Rating Board for a rating, and the Company's disclosures regarding hot coffee; disclosures and presentations by the Company of certain events, including acquisitions, partnering arrangements and earnings results; invoices from, payments to, and termination of PricewaterhouseCoopers LLP and retention of Ernst & Young LLP; acquisitions by the Company in 2005; certain compensation and human resources documents with respect to the Company and certain of its current and former officers and directors; and documents concerning the activities of the Company's Board of Directors and Committees thereof.

The Company has not been advised that it or any specific individual is presently a target of the investigation.

The Company is fully cooperating and providing the requested documents.

Update: I just spoke with Take-Two spokesman Jim Ankner who really couldn't shed any more light on the subpoenas. Since it is a grand jury investigation, it is likely that anyone called before them will not be allowed to discuss the case. So far, Ankner says, no people have ben subpoenaed, just documents. It is the Manhattan DA who is handling the investigation. (Well, technically, there grand jury, but you know what I mean.) Brian Crecente

Yesterday, we reported The Daily Show With Jon Stewart covered the video game foofurall. Today, we've got the vid. It's totally great, except for the last bit, which retroactively makes the whole thing a lot less funny. Just turn it off when they do the live, on-the-streets report from San Andreas.

The best line in the whole thing is actually not gaming related at all, but about the failure to raise minimum wage: "The lower strata of society has had a free ride for too long and if you were to give them $7.25 an hour, you just know it would go up their nose and down their hose." And in a mere 36 words, Jon Stewart expertly summarized the plight of the Kotaku blogger. Florian Eckhardt

Previously: Jon Stewart Takes On Congress Player Haters

This week the Entertainment Software Ratings Board announced Commitment to Parents, an effort geared at bolstering consumer confidence in the current rating system for video games.

Granted that's just my take on the initiative. I spoke with ESRB president Patricia Vance earlier this week about the program and she denied it was spurred by the on-going congressional hearings or Hot Coffee.

Either way, what really matters though is that the industry is taking some steps to tweak one of the chinks in their rating system's armor: retail enforcement.

While the program doesn't really have any teeth, it still does a good job of trying to create a culture of compliance, but building a retail "council" that requires members to follow the rules.

In essence what this does is creates a seal of approval for concerned parents. If you're worried about what your kids buy, just make sure they shop at a retailer that's a member of the ESRB Retail Council.

To be a member of the council, retailers have to enforce the ratings, train their sales staff about the rating system, promote the rating system in the store and through circulars and establish a system for consumer complaints about sales violations.

The most important element of the program is the creation of a mystery shopper program, which will track sales policy enforcement through two audits a year.

Vance tells me that they plan to have mystery shoppers hit about 100 stores from each chain during each audit.
While they will report the overall results of the audit, the ESRB won't break it down by retailer. That's unfortunate, because nothing would help compliance more than the thought of a public drubbing in the press or by politicians.

While I think this is a great step forward, I still think the ESRB has to reexamine the way they rate games. I know there's no easy answer for a medium that can contain such branching storylines and content, but letting developers or publishers choose what the raters see is tantamount to letting the fox guard the hen house. Brian Crecente

Game Industry Strengthens Ratings Enforcement [Rocky Mountain News]

We can't recall hearing this before, but News4Gamers.com is reporting that the graphic engine for GTA IV is actually the same RAGE engine used in the recently released Rockstar Table Tennis.

An excellent choice. RAGE is known for its excellent fluid physics. In Table Tennis, this can most obviously be seen in the way the beads of sweat realistically spray off the foreheads of the players. Imagine an opalescent string of pearls realistically jiggling upon the neck of an avatar and you will understand the full potential of this technology when applied to GTA IV... and, more specifically, it's forthcoming mod, 'Hot Coffee with Milk'. Florian Eckhardt

First Screens of GTA IV's Graphics Engine In Action [News 4 Gamers]

Hey, kids! Can you see what's wrong with this description of the Hot Coffee mod by KUTV-2 News anchor Bill Gephardt?

The government reprimands makers of a popular video game. Bill Gephardt says there's a loophole in this kid's game that allows players to see porn. Oops! The Federal Trade Commission says that the video game Grand Theft Auto: San Andreas has a tricky back door area and with the click of the code word 'hot coffee' players can view nudity and play sex games.

Man, if Hot Coffee was a secret code, it would quickly replace Up-Up-Down-Down-Left-Right-Left-Right-B-A-Start as my favorite code ever. Unfortunately, it's a mod that is rather obtusely applied to the original PS2 version of San Andreas.

There's also, of course, the entire chronological issue of his report, which represented Hot Coffee as a current problem as opposed to one that Take Two and Rockstar hadn't long since fixed . Or the fact that Grand Theft Auto: San Andreas was never marketed as a kids' game. Oh, and code words are rarely clicked. But who expects journalists to take a story for a test-drive before they hyperventilate anymore? Florian Eckhardt

Irresponsible Journalism Strikes Again [Press the Buttons]

Take Two, publisher of Rockstar Games Grand Theft Auto: San Andreas, received it's ruling from the Federal Trade Commission over the infamous "Hot Coffee" hidden sexual content incident. What was the punishment? Nothing really. Just a warning from the government. Still, Take Two did incur almost $25 million in losses in conjunction with the product's recall.

Footage of the Tomb Raider remake for PSP snuck out this week, much to the ire of publisher Eidos. First, the original Google Video was pulled, then all YouTube videos. It's looking good, but this was surely not how the Eidos marketing department wanted to reveal the game.

In other handheld news, every Nintendo fan's ultimate fantasy has been realized. Legend of Zelda alum Tingle is getting his own RPG, Freshly-Picked Tingle's Pink-Coloured Rupee Land! Surely, the title will be Americanized for its Western release, but we still expect the same effeminate mannerisms and copious prancing about for which Tingle is famous.

Sure, it's fun (and easy) to hate on 50 Cent's video game, Bulletproof. So fun, in fact, that the lead designer of the game let slip his distaste for working on such titles. Hey, I don't like showing up for my weekday job either, but these $200 jeans aren't gonna buy themselves.

What's the benefit to owning a PlayStation 3 on day one? Bragging rights, of course. Also, you may be the owner of a fully backward compatable PS2 playing device, sans software emulation, as the PS2 chipset may be included in earlier versions of the next-gen console. Suspect? Maybe, but who can guess what Sony will do these days?

Do you, or someone you know, have a World of Warcraft addiction? Now, there's help. Amsterdam-based Smith & Jones Addiction Consultants are set to open a detox center for console and PC gaming "addicts". Doesn't anyone just do heroin anymore?

Finally, it seemed that last week was full of DIY content. From the Xman portable to this homemade DDR pad to the Freetar beta release to this mutant Lego-Xbox-SNES monstrosity, it seems that gamers are more content than ever to make their own fun.

"According to the FTC, the companies, in advertising the Entertainment Software Rating Board ("ESRB") rating for the game, did not tell consumers that the game discs contained potentially viewable nude female characters and a potentially playable sex mini-game. Although San Andreas players could not access or view this sexual content during normal game play, sophisticated players posted a program on the Internet, dubbed "Hot Coffee," that revealed this content on the PC version of the game," FTC officials said.

While the company was not fined, they have been placed on notice that if they again violate the ratings, they will be subject to a civil fine of up to $11,000 per a violation.

Calls into Take-Two Interactive, the Entertainment Software Association and Senator Hillary Clinton had not been returned as of press time.

Today's findings come after a nearly year-long investigation into the publisher, developer Rockstar Games and the infamous Hot Coffee content found in Grand Theft Auto: San Andreas.

Hot Coffee, a bit of hidden sex found behind the apartment doors of the game, was discovered last July after a modder released a hack for the game that unlocked the previously hidden content.

At the time Rockstar first denied the claim that the content was in the game and then later said it was a piece of unused programming left on the disc, but not meant to be seen or played.

On July 20, the Entertainment Software Rating Board rescinded the game's rating and asked retailers to stop selling the game.

Take-Two agreed to a recall and rereleased the game with the content removed. According to the FTC, Take-Two incurred $24.5 million in losses associated with the GTA recall.

The recall came a week after Sen Hillary Clinton called for the FTC to investigate Take-Two interactive for deceptive marketing practices. That was followed by a similar request by the House of Representatives, which passed a resolution asking for an investigation.

While neither Clinton nor the House have the force of law to require the FTC to launch the investigation, it did certainly help the commission decide to look into Hot Coffee.

When I spoke with FTC spokeswoman Claudia Bourne Farrell last year she told me that the investigation would only be made public if enforcement action were taken. She added that in general, if the FTC were to find wrongdoings in an investigation, they have the ability to require a defendant to "give up their ill-gotten gains."

The FTC found that Take-Two and Rocksta Games violated the FTC Act by "representing that San Andreas had been rated "Mature" and assigned certain content descriptors by the ESRB, but failing to disclose to consumers that the game discs contained unused, but potentially viewable, nude female images and disabled, but potentially playable, software code for a sexually explicit mini-game that the ESRB had not rated."

Instead of fining the company, the FTC proposed a concenst agreement that requires the company to disclose all hidden content on their packaging that might be relavent to the rating, unless it was disclosed to the ESRB during the rating process. They also are requiring the comapany to develope a system to ensure that all content in a game is considered and reviewed while preparing to submit a game to the ESB.

Take-Two agreed to the proposal and the commission voted 5 to zero to accept it.

While Take-Two got off with a slap on the wrist, the greater issue at stake here is Clinton's claim that the ESRB's rating system is currently ineffectual at enforcement. Clinton would rather have a government run rating system than one run by the industry.

As this unfolds, nearly a year after Hot Coffee scalded the industry, congressional hearings are gearing up to examine both the impact gaming has on childen and the effectiveness of the ratings board. Coincidentally, just hours before the FTC announcement, Clinton put out her "Media Guide for Parents." The guide, she says, is to help parents make sure that when their children are on the Internet, playing video games or watching TV, it's safe and age-appropriate."

I've said it before and I'll say it again, this is video games own Seduction of the Innocents. Welcome to the Fourties

Edgy company Take Two might be known for hard hitting titles like Grand Theft Auto, but looks to be side-stepping controversy by canning Snow. Not connected with that Canadian reggae musician, the real-time strategy game lets players pedal and smuggle drugs. At last year's E3, the game was on display at last year's E3, but didn't make an appearance this year. Has gaming's bad boy, Take Two, gone soft?

Last year'sGTA Hot Coffee scandal lowered Take Two stock prices and angered many as the incident became a rallying call for all that was wrong with gaming. Snow and it's drug-related plot would've fueled the Jack Thompson-fire. 2K Games, the division behind the Snow, confirmed the cancellation, but failed to provide the rational. The shoveling of Snow could be an early reaction to possible criticism. Take Two gun-shy? The irony. Brian Ashcraft

More Here [CNN Money]

Thanks to Hannibal for calling our attention to this video, which he describes as "Hot Coffee for Smash Brothers". Entitled 'Jigglypenis', it features Jigglypuff using his pink, cotton candy cock as a battering ram. Worksafe, because this is a bit open to interpretation. FLORIAN ECKHARDT

With a decision by the FTC looming, you can expect a return to the full-on hysterical coverage of the game by mainstream and industry press alike.

While I can't imagine Take-Two will suffer more than a slap on the wrist, the bigger picture implications of this decision could be quite frightening. If, for instance, the FTC decides that Take-Two was deceptive they can't help but also lay some major blame on the Electronic Software Ratings Board.

Sure, the reasoning will likely go, Take-Two bent/broke the rules, but why didn't the ratings board catch them? And that would play straight into the hands of Hillary Clinton, who last year called out the ESRB's rating system, saying it was broken.

Coincidentally, as we speak congress, languid in the stifling heat of a Washingtonian summer, is ambling its way through a congressional hearing on video games and ratings.

This, readers, is what you call the makings of a perfect storm. A storm that no amount of wining and dining can stop. Brian Crecente

Anyway, after Rockstar accidentally got an interactive, thrust-by-thrust sex game in San Andreas, the FTC promised the concerned that they'd "look into it." And now, one year later, 1UP is promising that a report on whether or not Rockstar deceived the ESRB is expected soon.

Let's hope common sense prevails. Although there is a valid point that Rockstar's Hot Coffee mini-game went beyond titillation into quasi-pornography, the fact remains that it is a mod and companies should not be forced to disclose to the rating boards every asset in a game that some intrepid hacker may be able to fish out of the source. Although I have to admit, the fallout from Hot Coffee was good for me, as a gamer: it got Rockstar to release a second version of the PS2 game with that stupid bugged Zero mission

We'll let you know when the report from a bunch of career hypocrties comes in. FLORIAN ECKHARDT

FTC's Findings on GTA Forthcoming [1UP]

Okay, biased cynical pseudo-journalism warning here: is it just me or is the first part of that excuse a transparent attempt to make the second part sound less stupid? What does it mean that they didn't "consider" the extra blood and gore? Is there an especially gory monster in a side-quest they weren't aware of? Did Bethesda only show them the parts where you pick daisies and deliver hot meals to elderly invalids?

As for the "Hot Mead" skins, what's gained by taking into account material that isn't actually in the game as such, just on the disk? Surely it takes more effort to download and install a game mod than it does to enter your favorite naughty bit into Google and start clicking. I wonder if next World of Warcraft is going to get the M rating because "Tangy Clam Meat" sounds kind of naughty and if you put a dancing gnome behind a boar it looks like he's having sex with it.

At the same time, just to be snotty to everyone involved, you'd think that game developers would have the sense to make sure erotic Easter eggs get pulled before gold, no matter how obscured they are. Of course, this won't hurt sales. Release to a wide audience with a T rating, then get a publicity boost when the nipple textures are discovered. Nobody's head is going to roll over this.

ESRB Parent Advisory [Market Wire]

We're linking you to xboxic.com, in which the author of the post immediately begins hyperventilating about America's hypocrisy over the exposure of a bare human breast. Yes, yes — hot coffee, right. Because interactive, rhythmic sex games are the same as a bare breast. Anyway, xboxic.com claims this will delay the release in the US. But Firing Squad actually bothered to call Eidos, who says that the breast is only hackable in the Euro versions of the game, which is already out. It won't delay the US version.

So a visible breast, only available to European hackers, not belonging to Lara Croft, that won't delay the release of the game. Not news, in other words. Except that it allows us to post a jpeg of a disembodied breast, eerily floating upon a muddy texture. There's worse ways to start your weekend.

Nipplegate: new Tomb Raider delayed in US [xboxic.com]

The game is already off-line apparently, but Harry and Co. from Ain't-It-Cool-News took a few tasteless screen shots.

Did we say NSFW? Well, it's NSFW.

Hey, New Line Cinema is run by thirteen year-olds.
I didn't know that, did you know that?
No, I didn't know that.

Full Story Here [Defamer]

Next Generation reports that the city of Los Angeles is suing the two companies behind Grand Theft Auto: San Andreas for "leading a misleading marketing campaign and engaging in unfair competition." Reuters outlines the suit a little deeper. The suit wants Take-Two to "disgorge the profits from the estimated 200,000 copies of the game it sold for about $10 million in California." Take-Two's situation doesn't seem to be on the upswing just yet.

L.A. Sues Take-Two and Rockstar [Next Generation]
LA sues over Grand Theft game

The Street reports that Take-Two director Barbara A. Kaczynski submitted her letter of resignation. Her letter cites the Hot Coffee incident of summer '05 and an "increasingly unhealthy relationship between senior management and the board of directors ... characterized by a lack of cooperation and respect."

Take-Two Director Takes Off [The Street]

The AP s Matt Slagle looks back at the year in games in a story that ran today on the wires. He writes that the high and lowlights of the year includes GTA s Hot Coffee, VG laws, the PSP, Xbox 360 and Gizmondo.

His favorite games were Nintendogs, Resident Evil 4, Shadow of the Colossus, Psychonauts, Indigo Prophecy.

The Matrix Online and NARC were the only two that made his bad list.

Finally he touched on just two game movies: Alone in the Dark and Doom.

While this does touch on some of the outliers of the year, I don t think it really gives a good sense of what the year was about.

Besides not mentioning either the PS3 or the Revolution, he forgot all about epic games like God of War and complete pieces of crap like Charlie and the Chocolate Factory.

What would make your list as the most important gaming moments and titles of the year?

Gamepolitics reports that the Hot Coffee mess was one of the biggest PR blunders of the year, sharing space on a list with Tom Cruise's freak out on Oprah. Yikes. The full list is here.

Hot Coffee Scandal Named to List of Worst P.R. Blunders [Gamepolitics]
Stupid PR Tricks [Central Valley Business Times]
ESRB Recalls San Andreas

I was chagrined to see that John B Thompson was allowed to pen an article for the Fort Worth Star-Telegram over the weekend. I was disappointed to see that one of the top Texas papers gave him the space, and even more so since I started out my career as a journalist at the Startlegram more than a decade ago.

What's really perplexing is that he was able to get into the opinion section since he's not from the area and doesn't have any local ties. Sure, he's written a crappy book, but that's only the requirement to work there. LOL, just kidding, I love the FWST.

I'll provide a link, but it's not really worth visiting. As usual, he is pedantic and idiotic. Look for this crap to run in other papers as well. I'm guessing he or his publicist (probably John B himself) have hit up all the major papers along with a copy of his book and some paper's just can't resist free copy.

I just hope the paper allows some thoughtful game writer to respond in the same space. Sorta a point-counter point with Johnny playing Jane.

What kind of game is Hillary Clinton playing? [Fort Worth Star-Telegram]

However the Jack Thompson we all know and love, a.k.a John B. Thompson, is the subject of an internal review by the bar.

A spokeswoman from the Florida Bar returned my call this afternoon to confirm that to me. (Something Ars Technica had on the record this morning.)

The Bar is not involved in litigation with Mr. Jack Thompson or John B. Thompson and that it is a matter of public record that can be looked up, she said. What is going on with Mr. Thompson is that he is being reviewed by our lawyer regulation department for ethics complaints.

Ed's Note: Just had a long IM chat with Tor over at Gamespot about the much beloved Thompson. It sounds like the Bar is confused. I spoke with someone in Tallahassee who said the above. He spoke with the Miami Bar peeps who told him that there were no new active investigation into the man yet. I have a call into the head honcho down there and expect final, ultimate confirmation and deconfusion tomorrow.

Update 2: OK, so I had a long talk with a spokeswoman for the FlaBar in Miami. Here's the deal. Thompson is NOT under review by the ethics board. The reason he is not is because a formal complaint has not been filed against him. According to the spokesoman, a complaint isn't formal unless it has an original signature on it. What that means, of course, is that it has to be either mailed or hand-delivered and that emails and faxes don't count.

One the FlaBar received any complaint of ethics violations against a member, they always review it. So if someone were to file a formal complaint (with a signature) it would be reviewed by the board as part of the typical process. The board then has to determine if it warrants further investigation and if so it goes on to become a more detailed investigaiton. That investigation end with a determination and, if a violation is found, some sort of action.

There you have it. Hope that cleared up the confusion (I created.) And it also sounds like any emailed or faxed complaints against Thompson have been discarded. Doh!

Bar Investigating Jack Thompson? [Kotaku]

Think of it as Hot Coffee, but without all of the lawsuits and sex. Looks like some goofy Nintendo programmers slipped an Arwing fighter from Starfox into Ocarina of Time. A reader sent me this screen cap along with a link to the video. In it you can see Link spotting the spaceship.

Just in case you absolutely need to check this out for yourself, run out and buy a Gameshark and use this code to unlock the space-time anomaly.

Replace Kokiri boy lifting rock in Kokiri Forest (as young Link) with an Arwing from Lyrat Wars!!

OoT (europe) PAL V1.0
81242e26 0009
81242eb4 013b
81242ec2 0000

OoT (europe) PAL V1.1
8124b456 0009
8124b4e4 013b
8124b4f2 0000

OoT (US) NTSC V1.0
81244096 0009
81244124 013b
81244132 0000

OoT (US) NTSC V1.1
8124c806 0009
8124c894 013b
8124c8a2 0000

OoT (US) NTSC V1.2
8124cd06 0009
8124cd94 013b
8124cda2 0000

OK, that was your retro homework for the day. Class dismissed.

Video [Thanks Sinner]

After yanking GTA:San Andreas from shelves to remove the Hot Coffee sequence, Rockstar rereleased the Xbox and PC versions of the game sans mocha. The five Xbox owners who don't have the GTA: Double Pack are thrilled with the next release from Rockstar Games - GTA: The Trilogy, which includes GTA 3, GTA: Vice City and GTA: San Andreas. The Trilogy is slated for release in October, the same month GTA: Liberty City Stories is expected to ship for PSP.

I wonder if the release of Liberty City Stories will see a rise in violent crime among the youth of America. Someone keep an eye out for us.

Gamasutra intercepted an official ESRB email sent to all major publishers that reiterated a toughened stance on hidden content in video games.

The email states:

Fully disclosing hidden content accessible as Easter eggs and via cheat codes has always been part of ESRB's explicitly stated requirements when submitting games to be rated. In the July 20 public announcement, which focused on the revocation of a specific game's rating assignment, we formally stated that any pertinent content shipped on the game disc that may be relevant to a rating must be disclosed to ESRB, even if it is not intended to ever be accessed during game play.

Publishers have until Jan. 9, to disclose all hidden content in games that could adjust the title's rating. If another Hot Coffee incident occurs publishers will face "corrective actions."

Corrective actions sound like a nun standing over your desk with a ruler. My hand hurts just thinking about it.

Now that the Hot Coffee controversy has cooled off, Rockstar Games is readying Grand Theft Auto: San Andreas for a return to store shelves. According to online retailers EBGames and Gamestop, the Xbox version of the game will ship Sept. 13. Currently, the PS2 and PC versions aren't listed on the retailers' sites. It might be time to eBay those dirty versions of San Andreas, kids.

Brit website UK Resistance has a page of spoof screens from the "Feel the Magic" sequel, "Where do Babies Come From?"

Definitely not work safe. Highly instructional.

More Hot Coffee[UK Resistance]