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[Mifune]

I'm still amazed that people thought that Kotaku article was GOOD JOURNALISM. Yeah, a bunch of angry ex-employees talking shit about their former company and boss without a shred of evidence to back up anything. I'm sure some of what they said was true but the Nintendo stuff and "embezzling" charges always screamed abject horseshit to me.

And holy shit at comparing a Kotaku article to the New York Fucking Times. I'll give you a hint at the difference, Jason (by the way, you were better when you stuck to writing for Wired and not apologizing for whatever latest POS article your new outlet shits out)...one of those two has decades of built-up journalistic credibility, and one used to be banned on GAF. Hmmm...

 

[Jackpot]

Do posters understand that by writing off any anonymous sources they sound like this guy?

SK stole another company's engine, tried to get that company to pay them money and planned to sell the engine on as their own. Their failed attempt to defraud Epic cost everyone who worked at SK their jobs. The content of the Kotaku article is small potatoes compared to that.

 

[McBradders]

I can't even begin to fathom the number of people buying into this after a video that just says "nope".

We're talking about a man who went off for an entire hour on how NeoGAF was the worst place on the internet ever of all time and that should have the government come on in and shut it down. You think he can't talk a good game of denial for 30 odd minutes?

And would you reasonably expect him to say "yup, we did all that stuff we were naughty, lol"?

This is without even going into the Unreal skullduggery.

Fuckin' crazy. Quadruple crazy if you gave him money.

 

[runnin_blue]

The fact that he refutes some of the claims in the article that directly involve Activision and calls them completely untrue, leads me to believe that he is being somewhat truthful.

Or else he is really risking someone from Activision rebuking him. After all Activision is real and not some "anonymous source". If he lied about them then there is a very good chance that someone at their company would say something in response.

At the same time, I think the whole Precursor games thing is pretty fishy. As much as I want an Eternal Darkness 2, they are going to have to pull a rabbit out of a hat to convince me that they are capable of producing a quality game again.

But I wish them well as there are plenty of worse things in the world at the moment.

First-world problems.

 

[Waaghals]

Snip.

Just to clear things up, you know who these sources are, right?
I mean, they are not anonymous to the investigative journalist, just to the public?

i.e. you know that these people are credible?

(This is not an attempt to be snarky, it is a honest question.)

 

[flatearthpandas]

Will be interesting to see Kotaku's official response, as well as if Activision will back up Dyack's claims.

I'd like to comment on those parading the SotE demo with the church around like it substantiates the whole article... all it says is that these anonymous sources probably did in fact work at SK. The fact that SK was in fact working on an Eternal Darkness 2 demo doesn't mean they were siphoning money from other projects to do it, especially if Activision can verify having access to the managment resources and if the several audits Dyack claims can also be verified. There is no rule that devs can't work on multiple projects.

On my phone so I'll pull quotes later, but in regards to Dyack's claims that breaking down the claimed combined time at the company of the anonymous sources and asserting they wouldn't be privvy to the budget information they claim. I've seen at least one poster suggest that there could be 1-2 senior sources and the rest even lower on the totem pole. There would need to be at least two senior sources to give the claims any credence since the information was supposedly independently corroborated from multiple sources.

I wonder how many senior sources there were, how many years they must have between them to all have actually been privvy to the information, and then how many years that would leave for the ~6 other sources.

 

[Zabant]

The problem with Dyack and kotaku discussion on GAF is the confirmation bias.

There is good reason to throw ol' denny under the bus from this board due to it's dealings with him in the past. There is also however good reason to dismiss anything kotaku related outright, I cant help but think a lot of the posts here are not non-partisan.

 

[Eric the Red]

Do posters understand that by writing off any anonymous sources they sound like this guy?

It's pretty embarrassing so many people are having to have basic journalistic precepts explained them AFTER acting endlessly condescending about this. This SK thing is a fascinating situation, but I feel like it's being so sidetracked by people who feel the need to declare Kotaku's awfulness (endlessly) - even if they don't have actual valid criticism for this article. Back to reading the rest of this thread through the cracks between my fingers.

edit - @Waaghals
Yes, that is how it works. He even posted earlier that they were verified by the writer and editor.

 

[Mael]

The fact that he refutes some of the claims in the article that directly involve Activision and calls them completely untrue, leads me to believe that he is being somewhat truthful.

Or else he is really risking someone from Activision rebuking him. After all Activision is real and not some "anonymous source". If he lied about them then there is a very good chance that someone at their company would say something in response.

Exactly my point earlier at this point if the guy actually gives the details on how ATVI checked how the project was made and even the name of the 3rd party auditor, it'll mean Kotaku was full of shit.
There's no 2 ways about it.
Also I don't participate in Kickstarters so I don't have a dog in the race for the new game Dyack is making anyway.

Do posters understand that by writing off any anonymous sources they sound like this guy?

Nice strawman with a cool picture to back it up, that's actually more proofs than in Kotaku's article.

 

[Lothar]

I can't even begin to fathom the number of people buying into this after a video that just says "nope".

We're talking about a man who went off for an entire hour on how NeoGAF was the worst place on the internet ever of all time and that should have the government come on in and shut it down. You think he can't talk a good game of denial for 30 odd minutes?

What was this? Is there a link or something?

Not that it matters to me. He could be conclusively proven to be the embodiment of evil and I would still give him money for the chance of a sequel to Eternal Darkness.

 

[Lost Fragment]

It's pretty embarrassing so many people are having to have basic journalistic precepts explained them AFTER acting endlessly condescending about this. This SK thing is a fascinating situation, but I feel like it's being so sidetracked by people who feel the need to declare Kotaku's awfulness (endlessly) - even if they don't have actual valid criticism for this article. Back to reading the rest of this thread through the cracks between my fingers.

edit - @Waaghals
Yes, that is how it works. He even posted earlier that they were verified by the writer and editor.

An outlet that has a long history of carrying itself like it doesn't give a fuck about its credibility is naturally going to have a hard time getting people to trust them when they're making serious allegations and their only evidence comes from anonymous sources. That's a pretty basic journalistic precept there. The SimCity thing had way more to go on besides just anonymous sources anyway.

Given Dyack's history of general imbalancedness I wouldn't be shocked if this stuff turned out to be true, but just because he's a loon it doesn't mean that he must be guilty of every crazy thing that's alleged of him.

 

[MaxSanson]

Dyack or Kotaku..... what wonderful choices

 

[Thorgi]

OK, let's look at the best case scenario for Dyack, under the guise that the Kotaku article is false (which it isn't).

That doesn't undo everything else he's done. He attacked you guys for doubting in Too Human. He made Too Human. He made X-Men Destiny. Worse, he didn't pay for the Unreal engine, wanted Epic to pay them instead, and planned on selling the engine themselves after beating Epic in court. Even if you discount the article, he's a crook, a showboater, a liar, and he shouldn't be trusted with a single cent.

Also, some of you are confusing "anonymous source" for "Kotaku doesn't know who they talked to." They're well aware of the truth, and only ran the piece when they were certain beyond a shadow of a doubt that Dyack was leading publishers on a wild goose chase. They shouldn't have to reveal their sources because doing so might ruin the lives of the developers who spoke up. That's the unfortunate nature of the system; tell the truth about horrible working conditions in the gaming industry and you can talk yourself out of any job other than indie development.

After his multiple tantrums, his theft, his inability to make a good game, I can't believe you would take Dyack's side because he says "Oh no I didn't do anything Kotaku is bad games journalism." He was given a chance to comment before the story went up, and they didn't. He had five months to pipe up afterward, and he didn't. This isn't a "I didn't think anyone would believe them"; this is a last-ditch effort to resuscitate a crowdfunding campaign that's six feet under. He's desperate. And he should not be trusted.

 

[Mael]

OK, let's look at the best case scenario for Dyack, under the guise that the Kotaku article is false (which it isn't).

That doesn't undo everything else he's done. He attacked you guys for doubting in Too Human. He made Too Human. He made X-Men Destiny. Worse, he didn't pay for the Unreal engine, wanted Epic to pay them instead, and planned on selling the engine themselves after beating Epic in court. Even if you discount the article, he's a crook, a showboater, a liar, and he shouldn't be trusted with a single cent.

Also, some of you are confusing "anonymous source" for "Kotaku doesn't know who they talked to." They're well aware of the truth, and only ran the piece when they were certain beyond a shadow of a doubt that Dyack was leading publishers on a wild goose chase. They shouldn't have to reveal their sources because doing so might ruin the lives of the developers who spoke up. That's the unfortunate nature of the system; tell the truth about horrible working conditions in the gaming industry and you can talk yourself out of any job other than indie development.

After his multiple tantrums, his theft, his inability to make a good game, I can't believe you would take Dyack's side because he says "Oh no I didn't do anything Kotaku is bad games journalism." He was given a chance to comment before the story went up, and they didn't. He had five months to pipe up afterward, and he didn't. This isn't a "I didn't think anyone would believe them"; this is a last-ditch effort to resuscitate a crowdfunding campaign that's six feet under. He's desperate. And he should not be trusted.

Dude no everyone who doubt Kotaku sing the gospel of Dyack either, it's not a FOR or AGAINST poll.

 

[dionysus]

Just to clear things up, you know who these sources are, right?
I mean, they are not anonymous to the investigative journalist, just to the public?

i.e. you know that these people are credible?

(This is not an attempt to be snarky, it is a honest question.)

Anonymous sources may not be credible. Even if you assume they don't have an axe to grind (big assumption), just working at SK is not enough. Did they have vision into the budgetary process, time allocation, etc?

Lets have a little thought experiment. If you ran a company that over a decade employed 300 different people, many of whom were let go, do you think I could find 8 people willing to say bad things about you if I started cold calling every employee who had been fired?

Look, those anonymous sources are probably right in the general sense of mismanagement and even fraud, but that is because there is already evidence of fraud in there engine dealings with Epic. Anonymous sources, unless they are confirmed to be highly placed in the company, don't add any credibility at all.

 

[Somnid]

Do posters understand that by writing off any anonymous sources they sound like this guy?

SK stole another company's engine, tried to get that company to pay them money and planned to sell the engine on as their own. Their failed attempt to defraud Epic cost everyone who worked at SK their jobs. The content of the Kotaku article is small potatoes compared to that.

Hitler hated anonymous sources too. You don't want to be like Hitler do you?

I'm not on either side of this but this is not in a way a valid form of argument.

 

[Inspectah_Deck]

After reading this thread and some of it´s immature, irrational and witch-hunt esque comments i ask myself why behavior like this and this is not bannable?

Together with the extreme amount of WiiU trolling/trashtalking in the last few weeks, i think there should be some new official rules announcements, to make NeoGAF a place that is a joy to browse again.

 

[Kikujiro]

OK, let's look at the best case scenario for Dyack, under the guise that the Kotaku article is false (which it isn't).

That doesn't undo everything else he's done. He attacked you guys for doubting in Too Human. He made Too Human. He made X-Men Destiny. Worse, he didn't pay for the Unreal engine, wanted Epic to pay them instead, and planned on selling the engine themselves after beating Epic in court. Even if you discount the article, he's a crook, a showboater, a liar, and he shouldn't be trusted with a single cent.

Also, some of you are confusing "anonymous source" for "Kotaku doesn't know who they talked to." They're well aware of the truth, and only ran the piece when they were certain beyond a shadow of a doubt that Dyack was leading publishers on a wild goose chase. They shouldn't have to reveal their sources because doing so might ruin the lives of the developers who spoke up. That's the unfortunate nature of the system; tell the truth about horrible working conditions in the gaming industry and you can talk yourself out of any job other than indie development.

After his multiple tantrums, his theft, his inability to make a good game, I can't believe you would take Dyack's side because he says "Oh no I didn't do anything Kotaku is bad games journalism." He was given a chance to comment before the story went up, and they didn't. He had five months to pipe up afterward, and he didn't. This isn't a "I didn't think anyone would believe them"; this is a last-ditch effort to resuscitate a crowdfunding campaign that's six feet under. He's desperate. And he should not be trusted.

First, where are the proofs? You don't accuse someone by just saying "this is true because I said it", especially when dealing with personal implications. This is why other news outlets declined to publish the article, because they clearly considered it to be unethical.

I don't care about Dyack, but it's funny to see how people are trying to justify Kotaku's behavior just because they hate Dyack so much. And using arguments like "He attacked the forum! His games suck!" is childish and petty.

Oh, some anonymous sources told me you're a rapist, I believe their words and from now on I will consider you a rapist because they told me so. I don't need to prove you why they are right, but I demand you to prove me why they are wrong.

 

[Diddy Kong]

#TeamDyack or #TeamKotaku ?

 

[HagiG7]

#TeamDyack or #TeamKotaku ?

oh man that's so hard to choose. Is there a third choice?

 

[thumb]

Sk vs Epic games was a ruinous lawsuit, and by all appearances was meritless in the eyes of the law. The details are also well-documented in publicly available sources. It is a good reason to be skeptical, in the least, of Denis Dyack's decision making. One hopes that he has learned important lessons.

But this doesn't mean that all negative rumors about Dyack and SK are true. I'm awaiting Kotaku's response. I don't think the use of anonymous sources discredits the article, I'm more worried about whether the sources only knew things second or third hand and thus may have been mistaken.

 

[Thorgi]

First, where are the proofs? You don't accuse someone by just saying "this is true because I said it", especially when dealing with personal implications. This is why other news outlets declined to publish the article, because they clearly considered it to be unethical.

I don't care about Dyack, but it's funny to see how people are trying to justify Kotaku's behavior just because they hate Dyack so much. And using arguments like "He attacked the forum! His games suck!" is childish and petty.

Oh, some anonymous sources told me you're a rapist, I believe their words and from now on I will consider you a rapist because they told me so. I don't need to prove you why they are right, but I demand you to prove me why they are wrong.

And I would immediately dismiss your claims as false. I wouldn't wait five months; waiting five months is something a guilty man would do.

Also, way to ignore the wealth of court evidence that Silicon Knights stole Epic Games' engine.

 

[Lactose_Intolerant]

#teamGaf

 

[Cerebral Assassin]

After reading this thread and some of it´s immature, irrational and witch-hunt esque comments i ask myself why behavior like this and this is not bannable?

Together with the extreme amount of WiiU trolling/trashtalking in the last few weeks, i think there should be some new official rules announcements, to make NeoGAF a place that is a joy to browse again.

Those sort of questions should be asked of a mod, not randomly inserted into a thread(also backseat modding is a bannable offence, so you should be careful).

It's pretty embarrassing so many people are having to have basic journalistic precepts explained them AFTER acting endlessly condescending about this. This SK thing is a fascinating situation, but I feel like it's being so sidetracked by people who feel the need to declare Kotaku's awfulness (endlessly) - even if they don't have actual valid criticism for this article. Back to reading the rest of this thread through the cracks between my fingers.

edit - @Waaghals
Yes, that is how it works. He even posted earlier that they were verified by the writer and editor.

There is nothing wrong with using anonymous sources in an article, but when that is all the article is based on then it comes down to the credibility of the outlet running the story & clearly Kotaku has little in the eyes of many gaffers (add that to the fact that other more credible outlets declined to run the story & it is no surprise that people are questioning the story).

 

[Imbarkus]

I can find eight banned NeoGAF members tomorrow who would give me loads of independently corroborated accounts of the mismanagement here.

Yet my experience here has been characterized by even-handed management, interesting discussions, thoughtful participants, and a positive forum overall.

Without hard facts, it is all just a matter of perspective and opinion.

This being an internet forum, however, in response to this video there is endless debate over the details and minutae and what constitutes a verifiable fact in this quagmire.

But it was this stuff that stood out to me:

Denis Closing Thoughts
- "I made a lot of mistakes"
- "I said a lot of things I should not have said"
- "Learnt my lesson"
- Focusses on creative design now

I would have front-loaded this stuff a bit more myself, but the humility some people want to see is there. I don't blame him for not wanting to say "mea culpa" to a bunch of things that aren't true, however.

 

[Kusagari]

It's pretty embarrassing so many people are having to have basic journalistic precepts explained them AFTER acting endlessly condescending about this. This SK thing is a fascinating situation, but I feel like it's being so sidetracked by people who feel the need to declare Kotaku's awfulness (endlessly) - even if they don't have actual valid criticism for this article. Back to reading the rest of this thread through the cracks between my fingers.

edit - @Waaghals
Yes, that is how it works. He even posted earlier that they were verified by the writer and editor.

I personally believe that Kotaku did thoroughly check the sources and that the info in the article is mostly true.

That doesn't change the fact that media outlets need to earn their reputation and believability. Nobody is going to believe some random blog that craps out a story citing nothing but anonymous sources. And to many people Kotaku is barely a step above a random blog.

 

[MickeyPhree]

Dyack and his company lied about the unreal engine. Dyack = liar.

 

[PatientRain]

Honestly, why even respond - especially after so much time has passed.

And yes, I know, he says why in the video: my point is, he should have left this alone, rather than bringing it once again to the surface. Dyack's credibility and other problems were lurking long before the Kotaku article.

 

[RubberJohnny]

Just seen it.

He tries to make out that the article is not based in fact and their insider source is not true, but the way he does so is misleading.

He quotes forum and Youtube commenters about what's in the article rather than quote the article, so he can respond to things that aren't in the article as false (i.e. he responds to a commentator that says the article says they moved on from Nintendo because of the name and power of the Wii, which he says isn't true, but those statements aren't found in the original article).

Despite the claims that it's not true, the article actually is verifiably correct on a number of points:
1) the exact art assets the staffer said were finished being seen in the Shadow of the Eternals demo, proving that the insider did work there and what he saw was correct (not proven until long after the article came out).
2) Silicon Knights being a company with no employees that exists only on paper

He doesn't address these.

He also acknowledges a number of things that the article says as true - loss of staff, and his views towards the role of artists, although he argues semantics.

He denies that they diverted money from Activision, and says they paid it in to development, but the big take-away from the article is that they were a horribly mismanaged company that despite years of extra deadlines only managed to make a shitty arena brawler, if anything his revelations that they were working with an even bigger budget make that mismanagement seem even worse!

Best quote (I think this was mispeaking), "It was one of our worst Metacritic scoring games since our last game".

Saying that, I'm fairly sure the truth is somewhere in the middle - I can definitely imagine low or medium level employees hitting nasty crunch on a product going wrong, and seeing staff being put on another project, assuming that the other project (ED2) is getting all of the resources and not seeing the finances assuming SK're taking the money from Activision.

 

[EXGN]

This really isn't the case of Dyack or Kotaku; one is not right while the other is wrong. It's likely a lot of gray, with both sides exaggerating and telling half truths. I have no doubt that the Kotaku article was written with the feedback of eight former employees. I do think they exaggerated a bit, as would many spiteful recently released workers. I also think Dyack is lying through his teeth to try to save face. He is cherry picking different facts and trying to spin them in a way that makes him and his company look better.

You could go to any company and find spiteful ex-employees who would say damning things about their employer. That's their perception of the company. Of course, the owner of the company will also have a different perception of it. But realistically, Dyack has been known to over promise and under deliver, the situation with Epic and the Canadian government further highlights critical management issues at the company. I find it difficult to believe that either party is 100 percent accurate in their telling of the story.

 

[BloodMoney]

well, i made it 8 minutes into the video before i gave up on it. i just can't stand listening to someone with the presentation skills of a middle school student.

 

[Tylahedras]

I'm sorry but anyone who has their wife as head of HR, regardless of company size, is not to be trusted. That's just wrong on every level, and he knows it.

 

[Mael]

I'm sorry but anyone who has their wife as head of HR, regardless of company size, is not to be trusted. That's just wrong on every level, and he knows it.

If you have problems with family working in the same company as the head guy you better build your own.

 

[jkanownik]

It is weird that he says they spent $2M extra on XMD like that is a good thing.

 

[Neon_Icarus]

If Dyack really is the King of Evil (as implied in the Kotaku article), I have to wonder why those former SK employees chose to work with him again.

 

[EXGN]

If Dyack really is the King of Evil (as implied in the Kotaku article), I have to wonder why those former SK employees chose to work with him again.

A job is better than no job.

 

[Imbarkus]

I'm sorry but anyone who has their wife as head of HR, regardless of company size, is not to be trusted. That's just wrong on every level, and he knows it.

Startups hire family. It's kind of all over out here in the real world. Maybe at some point that should have changed, but you try laying off your wife. I dunno. What does that have to do with Precursor Games?

Its funny someone tried to play #teamKotaku and #teamDyack here because you also have #teamAntiDyack and #teamAntiKotaku. And #teamAntiDyack will never be convinced, and will flip around from topic to topic about the failure of Silicon Knights, continually ignoring the fact that Denis stated straight-up he is making no business decisions for Precursor.

..and that he made mistakes, and he's sorry about the way XMD turned out, and about comments he's made in defense of other projects. ...and that he's changed the way he thinks about things. ...and that he's focused solely on the creative side of things: the creative side of making a follow-up to Eternal Darkness.

So I'm from #teamShadowoftheEternals, because I don't really care if GAF likes Dyack or not, I just would like to feel I've seen the natural level of support for this title I would like to play, without all the party-poopers (who could just choose not to support, but instead chose to dredge up all this negative PR and forced it to be addressed).

Why continue evaluating the management skills and mistakes of the easy target who is not even managing the company?

 

[Tylahedras]

If you have problems with family working in the same company as the head guy you better build your own.

This is not an issue of nepotism, that's a separate problem. This is a clear conflict of interest, and one that no one with any integrity would allow to exist.

Is it illegal? No. But it is far from simply nepotism.

 

[Sean]

It's pretty embarrassing so many people are having to have basic journalistic precepts explained them AFTER acting endlessly condescending about this. This SK thing is a fascinating situation, but I feel like it's being so sidetracked by people who feel the need to declare Kotaku's awfulness (endlessly) - even if they don't have actual valid criticism for this article. Back to reading the rest of this thread through the cracks between my fingers.

What's so fascinating about the Kotaku article honestly?

SK made an X-Men game to keep the company afloat, the publisher demanded it be released on time, it turned out shitty with a poor Metacritic rating. The same exact story applies to almost every licensed movie game out there.

The two or three interesting allegations in the story (about embezzling money etc) had no proof to back them up.

 

[Neon_Icarus]

A job is better than no job.

If half the things in that article are true, you'd think they would rather work at McDonald's.

 

[G-Unit]

I lol at people validating anonymous sources. I LOL.

 

[John Harker]

Developers using money from publishers and putting it toward other projects is not entirely an uncommon practice

 

[Jac_Solar]

I'm sorry but anyone who has their wife as head of HR, regardless of company size, is not to be trusted. That's just wrong on every level, and he knows it.

Yeah, that is weird. They said that they had 2 other people working there as well at SK, so there shouldn't be any conflict of interest, but isn't it very likely that his wife could still find out things? Has access to the system? So there'd be a conflict of interest regardless. Spouses working in different positions at a company isn't really a problem; but it obviously is when they are working at HR.

 

[Imbarkus]

I think the Eurogamer write-up is, once again, the best: http://www.eurogamer.net/articles/2013-05-20-denis-dyack-im-sorry-for-x-men-destiny

 

[ProfessorMoran]

I can't even begin to fathom the number of people buying into this after a video that just says "nope".

We're talking about a man who went off for an entire hour on how NeoGAF was the worst place on the internet ever of all time and that should have the government come on in and shut it down. You think he can't talk a good game of denial for 30 odd minutes?

And would you reasonably expect him to say "yup, we did all that stuff we were naughty, lol"?

This is without even going into the Unreal skullduggery.

Fuckin' crazy. Quadruple crazy if you gave him money.

The way Dyack oversells his games makes snake-oil salesmen look like boyscouts, and there are always some people who would buy into anything he says just to keep thd dream alive that somehow there will be an Eternal Darkness 2.

 

[duckroll]

I think the Eurogamer write-up is, once again, the best: http://www.eurogamer.net/articles/2013-05-20-denis-dyack-im-sorry-for-x-men-destiny

"At the time of publication $156,775 had been pledged of its $1.35 million goal with 29 days to go."

???????

 

[Imbarkus]

"At the time of publication $156,775 had been pledged of its $1.35 million goal with 29 days to go."

???????

Well I commented them a correction on that.

That's Precursor's bad for this split-funding confusion.

But it summarizes the video well. Polygon didn't even bother.

But maybe you didn't want him to admit mistakes. Maybe it take raving megalomania to get funded, I don't know.

 

[Shiggy]

Any comment from Kotaku yet?

 

[Morrigan Stark]

I'm sorry but anyone who has their wife as head of HR, regardless of company size, is not to be trusted. That's just wrong on every level, and he knows it.

Not uncommon. My boyfriend used to work for a small company where the HR lady was the boss's wife. She took care of hires and administrative stuff, but the company was so small that it was unlikely to require HR to solve personal disputes anyway.

With SK, apparently there were 2 more HR people other than Mrs. Dyack that the staff could talk to, so I don't really see the problem.

 

[Shiggy]

Not uncommon. My boyfriend used to work for a small company where the HR lady was the boss's wife. She took care of hires and administrative stuff, but the company was so small that it was unlikely to require HR to solve personal disputes anyway.

With SK, apparently there were 2 more HR people other than Mrs. Dyack that the staff could talk to, so I don't really see the problem.

The problem at SK also was that the company started out as a small firm, where it is indeed not uncommon that family members take some role (even in HR). This might be a problem when the company is growing (in SK's case: to more than 100 employees at one point).