Silicon Knights alleged that Crystal Dynamics had failed to inform them of their intention to leave the publishing business, and had misrepresented themselves to Activision as Blood Omen's developer. Among other assertions, they claimed that Crystal Dynamics had breached an agreement in late 1996 by selling certain publishing rights to the game-and any potential sequels-to Activision for $2,000,000. During the proceedings, Silicon Knights stated that they had ceded the Blood Omen intellectual property to Crystal Dynamics under 'financial duress'. In 2012, NeoGAF member Mama Robotnik highlighted public records of the 1997 court case. Successive titles in what was now the Legacy of Kain series were produced by Crystal Dynamics and Eidos, whereas Silicon Knights walked away from the franchise to begin work on Too Human, and later Eternal Darkness: Sanity's Requiem. It originated as Shifter-an unrelated project inspired by Biblical mythology, devised by Crystal Dynamics' Amy Hennig and Seth Carus (both of whom had worked as designers on Blood Omen)-whose team, initially reluctantly, reworked it into a Blood Omen sequel at the request of company management. Later, it publicly emerged that Soul Reaver had never been a Silicon Knights concept. Crystal Dynamics was acquired by Eidos Interactive, who published Soul Reaver in 1999 to critical acclaim and commercial success. The dispute was settled in private, with Crystal Dynamics retaining the rights to the game, and permission to create derivative work using its characters, provided they credit Silicon Knights as the developer of Blood Omen in their sequel. Silicon Knights, they reported, accused Crystal Dynamics of plagiarizing their concept for a sequel. In 1997, GameSpot divulged that Silicon Knights had filed a lawsuit against their former partner for ownership of the series, requesting an injunction to prevent Crystal Dynamics from publicizing Soul Reaver. Subsequently, the relationship between both parties dissolved, and Crystal Dynamics-who had withdrawn from software publishing to focus exclusively on game development-announced their own follow-up in the form of Legacy of Kain: Soul Reaver. In an interview conducted shortly after the PlayStation release, Dyack contemplated the possibility of creating a prequel centered around the character of Vorador-referring to it as part of the 'Blood Omen series'-but mentioned that it was 'extremely unlikely' that Silicon Knights would work with Crystal Dynamics again. Blood Omen did receive a sequel, but its production was impeded by a litigious battle between the game's stakeholders and developer. By the time Blood Omen was released, Crystal Dynamics had already secured a deal with Activision to publish a sequel.

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