Last month, Guitar Hero II executive producer John Tam and brand manager Corey Fong reached a settlement with Activision, and GameSpot's coverage of the recently issued court injunction supplies some tantalizing details on the whole affair. In short, Tam, Fong, former RedOctane hardware group member Jamie Yang, PR firm Reverb Communications and peripheral manufacturer The Ant Commandos were all working together to form a new studio, known as Lodestone Entertainment, which would "compete with Activision using Activision's confidential and proprietary information." Furthermore, Tam and Fong used Activision resources to create the demo used in their attempts to secure investors for Lodestone, which mixed the gameplay of Harmonix's guitar-based Guitar Hero with a dance pad a la Konami's Dance Dance Revolution.

In 2006, RedOctane and Activision had begun pursuing legal action against The Ant Commandos for its unlicensed line of Guitar Hero controllers under the Guitar Mania brand. Activision alleged that The Ant Commandos infringed upon their trademarks and copyrights, engaged in unfair and deceptive trade practices, exhibited unfair competition, and released false advertising. A few days later, The Ant Commandos counter-sued, suggesting that RedOctane had actually stolen the design of their guitar controller from The Ant Commandos in the first place. The companies later agreed upon a mutual settlement that allowed The Ant Commands to continue distributing their line of guitar-shaped controllers, though further details of the agreement were not disclosed.

This past February, Activision once again pursued legal action against The Ant Commandos, along with three previous RedOctane employees--Tam, Fong, and Yang--who were hit with a laundry list of charges including copyright infringement and breach of contract. Charges were also brought against Reverb Communications, the PR firm that represented RedOctane before the Activision acquisition. Reverb had recently announced it was working with The Ant Commandos and its vice president of business development had joined The Ant Commandos' board of directors.

As a result of last month's settlement, Tam and Fong are prevented from future use and distribution of the aforementioned demo. They can not be involved with the production of anything similar to the Activision peripherals detailed on a confidential list until six months after the device's commercial release, including the Xbox 360 version of Guitar Hero II that hit stores today. The duo must submit to Activision any and all documentation and materials in their possession relating to proprietary company information, Lodestone Entertainment, and any discussions between Reverb Communications and The Ant Commandos. Nor can they participate in the development of music games featuring guitars, drums or synthesizers for the next year, suggesting Activision may soon be acting on their Band Hero, Drum Hero, Keyboard Hero, Guitar Villain and Drum Villain trademarks.

Amusingly, the MTV-owned Guitar Hero developer Harmonix, which just announced its new instrument-based music game Rock Band in conjunction with Electronic Arts, is not explicitly involved with these proceedings in any way.