Looking at the discussion on the site, it's pretty clear that although there wasn't proof beyond reasonable doubt of the crime of fraud, the company refused to show their work - give any details about what happened to the money or why they weren't able to deliver - and the backers took this as an indication of deliberate fraud, and that was why they pressed for this lawsuit - they were retaliating against someone who as far as they could see had deliberately cheated them. As far as I know, kickstarter backers have a pretty good track record of being forgiving when the project creator shows good faith.