Kickstarter updates its terms of use to address failed projects

Sometimes, Kickstarter enables the ideal relationship between developers and backers. You back Shovel Knight , the studio gets to work, and when it's released you get a great game that might not have been made otherwise. But when projects crash and burn, as many inevitably do, it can get weird and unpleasant. A recent update to Kickstarter's terms of use aims to clarify where creators, backers, and Kickstarter itself stand during these unfortunate incidents.

The terms of use further explain that if creators are unable to complete their project and fulfil rewards, then they've failed to live up to the basic obligations of the agreement. In that case, the Kickstarter creator can remedy the situation if:

they post an update that explains what work has been done, how funds were used, and what prevents them from finishing the project as planned;
they work diligently and in good faith to bring the project to the best possible conclusion in a timeframe that's communicated to backers;
they're able to demonstrate that they've used funds appropriately and made every reasonable effort to complete the project as promised;
they've been honest, and have made no material misrepresentations in their communication to backers; and
they offer to return any remaining funds to backers who have not received their reward (in proportion to the amounts pledged), or else explain how those funds will be used to complete the project in some alternate form.

If creators are unable to satisfy these terms, they may be subject to legal action by backers.

That seems pretty clear, but it still puts backers in a tough spot when a project fails. The onus is on them to pursue legal action. The main takeaway here seems to be that if you're upset over Neal Stephenson's Clang dissolving , you should direct your phalanx of lawyers at him, not Kickstarter.