The thing is, people claiming fraud are claiming KDG acted with malice. That their intent was to defraud, from the outset. Malice is one of the hardest things to prove because it's about what was in someone's heart when they did something. You can demonstrably prove their initial claims were false.
I would disagree that malicious mens rea is necessary for the intent to be to defraud from the outset. One can intend to mislead while still thinking that one has the customer's best interests at heart. (If you think the desire to mislead, however "minor" you might consider the deception, is inherently malicious, then we just have a semantic disagreement.)
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The possibility that strikes me, personally, as most likely is the one where Josh (with or without Joe's knowledge, that's harder for me to determine, and the fact that we only have Joe's side of the story makes me unwilling to assume Joe's version is the fully true one) exaggerated what was already done as part of an effort to get the KS to be successful. Unseemly, for sure, but, much like speeding, it's an unseemly thing which I think of as almost universal among Kickstarter campaigns, including plenty of successful ones. (And I'm defining "successful" pretty loosely here, because if we defined success by a KS delivering what it promises *when* it promised it would, I doubt the success rate in the video game space hits the double digits.) So, probably meets a legal definition of fraud in a number of jurisdictions but, to reiterate my point above, a fraud which I suspect almost every KS campaign of.
Then, there's that time of high morale, right after the campaign funded. Joe and Josh are probably high on living their dream. They're now officially professional video game developers! Why, the generosity of backers is going to let them make a game even *cooler* than the one they had initially planned! Art assets are bought. Plans are shared.
And then the reality of video game development starts to set in. There's a problem. Looks like a big refactor is going to be needed. Didn't help. A partial rewrite? Didn't help. Damn, now we're two weeks behind. Somewhere along the way, you start getting exposed to the ugly side of the internet, where people are quite happy to tell you, at length, how the thing you're doing is crap, or the way you're doing it is rubbish. And, now, when your fourth attempt to squash that bug still fails to do the trick, you start to wonder... are they right? Maybe you just need a break... you've been neck-deep in this game for months straight. So maybe you take a week off. I mean, you're already late, so what's a week?
I've never been that developer. But I've definitely had to manage that developer. Hell, I've had to fire that developer before, because if you can't tell me that you're having that big of a problem, then I can't help you solve that problem, and you're just wasting the company's money.
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I haven't seen anyone make the argument that what Josh is doing is polite, or good business, or even reasonable. I haven't seen anyone arguing that he doesn't constantly break self-imposed commitments without warning. He is being selfish, and, in doing so, has lost most of his supporters and what was probably one of his only remaining friends. I think it exceedingly unlikely that Josh's life is currently what anyone would classify as "happy". And all of that is stuff he could have avoided with relatively minor behavioral changes. (I say minor to describe difference from the behavior he chose, not how easy or difficult he would have found those changes to make; I don't know the man, much less the inner-workings of his brain.)
I think most people participating in this conversation would agree that the project was an interesting idea that they'd like people to get to play through.
I don't begrudge people who want to argue, even academically, what laws Josh has or hasn't broken, so long as they're at least clear in the priors they're assuming. I think there's room in this thread for the mobs with pitchforks and the people who want to discuss how cool, or lame, the content of the videos are every few months when they randomly appear. But the internet takes people's natural tendency to fall into opposing camps and dials it up to 11. So I just like to remind myself, sometimes, that we're mostly arguing over things at the edges, while agreeing to a solid 90% of the facts, and even mostly agreeing in our opinions.