ACCOLADE APPLAUDS APPELLATE COURT DECISION IN SEGA VS. ACCOLADE

SAN JOSE, CA -- AUGUST 31, 1992 -- Accolade, Inc. today announced that the
Ninth Circuit Court of Appeals has dissolved the injunction which
prevented it from developing, manufacturing or selling video games that
are compatible with Sega's Genesis system. On Friday, August 28, the Ninth
Circuit issued a brief, unanimous order, in the landmark Sega vs. Accolade
case, throwing out the District Court's injunction, which was issued in
April of this year. The order also noted that an opinion specifying the
reasons for the Court's decision would be issued in the future.

Accolade Chairman Alan R. Miller, applauding the Ninth Circuit's decision,
stated, "I'm tremendously pleased by the Court's confirmation of
Accolade's position in our dispute with Sega. We were convinced that the
actions Accolade took to study the interface requirements of Sega's
Genesis game system were perfectly proper and thoroughly in accord with
standard industry practice. Although the Ninth Circuit's final opinion has
not yet been issued, we have every reason to believe that the opinion will
support our position on both the copyright and trademark issues and
vindicate our reverse engineering activities."

In its lawsuit, Sega alleged that its copyright and trademarks were
infringed when Accolade studied a Sega Genesis game system and several
game cartridges to learn how to make Accolade games compatible with the
system. Specifically, Sega claimed that Accolade illegally copied its
software during its reverse engineering. Reverse engineering is a widely
used method of studying how a product operates in order to develop
products that are interoperable with it.

Accolade argued that its actions were protected by law and legal
precedents, which encourage the study of ideas and functional elements in
copyrighted information. No previous case has held that the mere
disassembly of computer programs, including the making of copies for the
purposes of analysis of interface specifications, constitutes a copyright
infringement where the final product is not "substantially similar" to the
original program. "Sega has never claimed that Accolade's game programs
are 'substantially similar' to Sega's, because they are not," said
Miller.

"The impact of the Court's order on Accolade's business will be very
positive," stated Miller. "Now that the injunction against our line of
Sega Genesis-compatible products has been overturned, we look forward to
returning to our previous position behind Electronic Arts as the second
leading independent publisher of Sega Genesis compatible products."

Miller continued, "I want to publicly acknowledge and applaud the excellent
counsel and representation we have received in this case from the law firm
of Gibson, Dunn & Crutcher. The litigation team of Bill Coats, Rex Heinke,
David Shannon, Heather Rafter, Kelli Sager, and Pat Scatena from the
firm's San Jose, San Francisco, and Los Angeles offices, and their staffs,
have my thanks and admiration. And throughout this litigation, the
assistance of our longtime corporate counsel, Doug Neilsson of Gibson,
Dunn's San Jose office, has been invaluable.

"I especially want to thank the groups who recognized the importance of our
case and joined in our appeal of the district court decision as amicus
curia. These include the American Committee for Intel-operable Systems
(ACIS), eleven distinguished professors of copyright law, and the Computer
and Communications Industry Association (CCIA). The briefs from these
groups undoubtedly made a significant contribution to this important
decision. All of the information technology industries owe them a vote of
thanks."

Accolade, with headquarters in San Jose, California, is a leading developer
and marketer of entertainment software for IBM-compatible, Macintosh, and
Amiga personal computers and is a licensed developer and marketer of video
game software for Nintendo and NEC video game systems.

Accolade Inc, 5300 Stevens Creek Blvd, San Jose, CA 95129
408-985-1700,  fax: 408-246-1053

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