A computer games ''wizard'' who has been described as the ''Spielberg'' of the industry is being sued for #1.5m damages for breach of contract.

A judge has criticised as ''less than frank'' the evidence of Mr David Jones, who started his Dundee-based company, DMA Design, as an undergraduate to exploit a game he had developed at university.

Lord Penrose also accused DMA of acting ''cynically'' and ruled that it had been guilty of a breach of contract over a marketing deal.

In a written judgment issued yesterday at the Court of Session, the judge allowed further evidence to be heard on the amount of damages to be paid to The Liaison and Promotion Company Ltd, of London, which is seeking an award of #1.5m.

The judge said that until about 1993 the computer games industry was largely controlled not by the designers of games, like DMA, but by the publishers.

DMA had designed a series of ''Lemmings'' games which were a commercial success but DMA had given up its rights in Lemmings in return for a royalty payment and the company began to resent the lack of public recognition of its work. Mr Jones then began to develop contacts with publishers in America and Japan.

At the same time, Liaison, which was involved in the music industry as managers, had been keen to tap the potential of the computer games market. It made contact with DMA and offered to oversee the marketing and promotion of the Dundee company and its games. A deal was struck in July 1993.

In the following months Liaison introduced DMA to a number of companies. One deal, with the BMG group, earned DMA about #3.4m.

Liaison raised the court action after DMA refused to pay for the role it had played in the run-up to the deal.

DMA claimed that before the deal it had severed the relationship with Liaison which was not entitled to receive a payment for merely introducing the two sides.

Liaison insisted that Mr Jones had told them that a deal was not going to be done with BMG but with another company, probably Virgin.

Lord Penrose said in his view it was clear that Mr Jones had ''dissembled'' in discussions with other parties involved. While negotiations with BMG matured, he had represented to Liaison that there were no negotiations which had any prospects of success.

Lord Penrose said: ''If one believed Mr Jones's evidence it would simply confirm that he had a poor sense of business and that he was totally naive in his business relationships.

''If his perception had been valid, there would have been a discontinuity in relationships broken by an unanticipated communication from BMG after he had severed relationships with Liaison quite fortuitously and without reference to their continuing efforts.

''It is not an acceptable picture. Mr Jones was on any view a highly intelligent man with a keen analytical mind. He could not devise computer software of the complexity involved in computer games otherwise.''

The judge added that at times Mr Jones simply had not been frank in giving evidence.

Lord Penrose said he had formed the firm view that without Liaison there was no reason to believe that the contract would have been concluded between DMA and BMG.

''Liaison brought the parties together to reach the point at which they both wished to enter into a contract. They created a situation in which BMG got to know DMA and DMA got to know how a multinational company like BMG could help them, and they helped created respect for DMA as a creative agency.

''I consider it to be clear beyond doubt that the reason that Liaison were not involved in the late stages of negotiation was the rather cynical action of DMA in seeking to exclude them on the pretext that they had not performed to stipulation. That led to the question of whether DMA had been entitled to break off the relationship with Liaison or whether it was a breach of contract.''

In the judge's opinion, the purported termination of the relationship was a breach of contract.

Having reached that view the judge ordered that there should be another hearing to decide how much damages Liaison should receive.