<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2002

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                        Commission file number 000-24711

                             EBS LITIGATION, L.L.C.
             (Exact name of registrant as specified in its charter)

                  Delaware                                     13-3989964
       (State or other jurisdiction of                      (I.R.S. Employer
       incorporation or organization)                    Identification Number)

               90 Park Avenue
          New York, New York 10016
   (Address of principal executive offices)

                                 (212) 682-7474
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]


At August 1, 2002 there were 10,000,000 Class A Membership Units outstanding and
no Class B Membership Units outstanding.

<PAGE>

                         PART I. FINANCIAL INFORMATION



Item 1.  Financial Statements

                             EBS LITIGATION, L.L.C.
                            Statements of Operations
                      For the Three and Six Month Periods
                          Ended June 30, 2002 and 2001
                          ----------------------------


<TABLE>
<CAPTION>
                                                    For the three months                 For the six months
                                                       ended June 30,                      ended June 30,
                                                   2002              2001              2002              2001
                                               (unaudited)        (unaudited)       (unaudited)      (unaudited)
<S>                                           <C>                 <C>               <C>             <C>
Income:
      Defendant payment revenue                $  113,126          $   -             $ 113,126       $    -
      Interest                                      3,261             14,269             7,397           33,181
                                               ----------          ---------         ---------       ----------
         Total income                             116,387          $  14,269           120,523           33,181
                                               ==========          =========         =========       ==========
Expenses:
      Legal and accounting fees                   188,631            132,652           431,870          191,152
      Insurance                                    17,451             17,451            34,711           34,711
      Transfer agent and
      settlement administration fees                9,500              9,500            19,000           19,000
      Manager fees                                 10,433              7,121            15,073           14,370
      Other                                         1,308                700             2,108            1,400
                                               ----------          ---------         ---------       ----------
         Total expenses                           227,323            167,424           502,762          260,633
                                               ----------          ---------         ---------       ----------
Net loss                                       $ (110,936)         $(153,155)        $(382,239)      $ (227,452)
                                               ==========          =========         =========       ==========
Net loss per unit - basic and diluted          $    (.011)         $   (.015)        $   (.038)      $    (.023)
                                               ==========          =========         =========       ==========
</TABLE>




   The accompanying notes are an integral part of these financial statements.



                                       2


<PAGE>

                             EBS LITIGATION, L.L.C.
                                 Balance Sheets
                      June 30, 2002 and December 31, 2001
                      -----------------------------------





<TABLE>
<CAPTION>

                                                                           June 30, 2002           December 31,
                                                                            (unaudited)                2001
<S>                                                                        <C>                     <C>
Assets
Cash and cash equivalents
     Available for general operations                                      $     921,784           $   1,209,813
Prepaid insurance                                                                 16,685                  51,397
Interest receivable                                                                  918                   2,084
Miscellaneous receivable                                                               -                       -
                                                                           -------------           -------------
         Total assets                                                      $     939,387           $   1,263,294
                                                                           =============           =============
Liabilities
Accrued expenses                                                           $     206,205           $     147,873
                                                                           -------------           -------------
         Total liabilities                                                       206,205                 147,873
                                                                           -------------           -------------
Members' equity:
     Membership Units (Class A - 10,000,000 authorized, issued
      and outstanding at June 30, 2002 and December 31, 2001)
     Retained earnings                                                           733,182               1,115,421
                                                                           -------------           -------------

         Total members' equity                                                   733,182               1,115,421
                                                                           -------------           -------------

         Total liabilities and members' equity                             $     939,387           $   1,263,294
                                                                           =============           =============
</TABLE>





   The accompanying notes are an integral part of these financial statements.

                                        3

<PAGE>


                             EBS LITIGATION, L.L.C.
                     Statements of Changes in Members' Equity
                              For the Periods Ended
                       June 30, 2002 and December 31, 2001
                       -----------------------------------



<TABLE>
<CAPTION>

                                                Class A
                                               Membership                Retained
                                                 Units                   Earnings                Total
<S>                                           <C>                    <C>                    <C>

Balance, January 1, 2001                       10,000,000             $  1,507,175           $  1,507,175

Net loss                                          -                       (391,754)              (391,754)
                                               ----------             ------------           ------------
Balance, December 31, 2001                     10,000,000                1,115,421              1,115,421

Net loss (unaudited)                              -                       (382,239)              (382,239)
                                               ----------             ------------           ------------
Balance, June 30, 2002 (unaudited)             10,000,000             $    733,182           $    733,182
                                               ==========             ============           ============
</TABLE>





   The accompanying notes are an integral part of these financial statements.

                                        4

<PAGE>

                             EBS LITIGATION, L.L.C.
                            Statements of Cash Flows
                            For the Six Months Ended
                             June 30, 2002 and 2001
                             ----------------------

<TABLE>
<CAPTION>




                                                                            For the six months ended
                                                                                    June 30,
                                                                         2002                       2001
                                                                      (unaudited)                (unaudited)
<S>                                                                 <C>                       <C>
Cash flows from operating activities:
     Net loss                                                        $  (382,239)               $   (227,452)
     Reconciliation of net loss to cash flows used in
     operating activities:
         Decrease in prepaid insurance                                    34,712                      34,711
         Decrease in miscellaneous receivables                             -                           5,000
         Decrease in interest receivable                                   1,166                       3,261
         Increase in accrued expenses                                     58,332                      40,397
                                                                     -----------                ------------
             Cash flows from operating activities                       (288,029)                   (144,083)
                                                                     -----------                ------------
Net decrease in cash and cash equivalents                               (288,029)                   (144,083)

Cash and cash equivalents at beginning of period                       1,209,813                   1,545,066
                                                                     -----------                ------------
Cash and cash equivalents at end of period                           $   921,784                $  1,400,983
                                                                     ===========                ============
</TABLE>


   The accompanying notes are an integral part of these financial statements.

                                        5





<PAGE>

EBS Litigation, L.L.C.
Notes to Financial Statements
June 30, 2002 and December 31, 2001
--------------------------------------------------------------------------------

1.        Description of Business

          EBS Litigation, L.L.C. (the "Company") is governed by a Members
          Agreement, dated as of September 25, 1997 (the "Members Agreement").
          Pursuant to the Members Agreement, the Company's purposes are to (a)
          prosecute, settle and/or liquidate the Unresolved Avoidance Claims
          relating to the distribution by Edison Brothers Stores, Inc.
          ("Edison") of approximately 4.4 million shares of common stock of Dave
          & Busters, Inc. to holders of Edison common stock in the form of a
          dividend and all related transactions (the "Unresolved Avoidance
          Claims"), (b) receive, and administer the cash proceeds of the
          Unresolved Avoidance Claims, and (c) distribute the net proceeds to
          the appropriate holders of Membership Units (the "Members") in
          accordance with the Members Agreement.

2.        Summary of Significant Accounting Policies

          This summary of significant accounting policies is presented to assist
          in evaluating the Company's financial statements included in this
          report. These policies conform to accounting principles generally
          accepted in the United States. The preparation of financial statements
          in conformity with accounting principles generally accepted in the
          United States requires that management make estimates and assumptions
          which impact the reported amounts of assets and liabilities at the
          date of the financial statements and the reported amounts of revenues
          and expenses during the reporting period. Adjustments are of a normal
          and recurring nature. Actual results could differ from those
          estimates.

          Basis of Presentation

          These financial statements include the accounts of the Company for the
          periods from January 1, 2001 through December 31, 2001, January 1,
          2001 through June 30, 2001 (unaudited), January 1, 2002 through June
          30, 2002 (unaudited), April 1, 2001 through June 30, 2001 (unaudited),
          and April 1, 2002 through June 30, 2002 (unaudited).

          Cash and Cash Equivalents

          Cash and Cash Equivalents consists of amounts held in an account in
          the Company's name at a highly-rated financial institution, which
          funds are invested in an institutional money market fund investing
          solely in direct obligations of the United States Government.

          The Company's cash and cash equivalents represent the sum of the
          aggregate Dave and Busters, Inc. Spinoff Settlement Proceeds and the
          L.L.C. Funding Amount. These funds will be used for general
          operations. Any amounts not used in general operations will be made
          available for future distributions to Class A Membership Unit holders.

          Accrued Expenses

          Accrued expenses include amounts payable to service providers and
          other vendors. Amounts are payable within one year.

          Defendant Payment Revenue

          Defendant payment revenue is determined on an accrual basis and
          represents settlements with individual defendants of Avoidance Claims
          during the period.

          Interest

          Interest income is determined on the accrual basis. Interest
          receivable is due to be received within one year.

          Expenses

          All expenses of the Company are recorded on the accrual basis of
          accounting.

                                        6

<PAGE>


EBS Litigation, L.L.C.
Notes to Financial Statements
June 30, 2002 and December 31, 2001
--------------------------------------------------------------------------------

          Income Taxes

          The Company is not subject to income taxes. Instead, the Members
          report their distributive share of the Company's profits and losses on
          their respective income tax returns.

3.        Members' Equity

          On September 25, 1997, Edison transferred its rights, title and
          interest in the Unresolved Avoidance Claims. In addition, as of
          September 25, 1997, Edison was obligated to provide cash funding to
          the Company of $2.0 million (the "LLC Funding Amount"), which was
          subsequently paid to the Company on October 16, 1997. Such transfer
          and funding were in exchange for 10,000,000 Class B Membership Units
          of the Company, which represented all of the outstanding Membership
          Units of the Company. On December 12, 1997, in accordance with the
          Company's Members Agreement and the Plan of Reorganization, Edison
          exchanged 9,064,140 Class B Membership Units for 9,064,140 Class A
          Membership Units of the Company and simultaneously distributed such
          Class A Membership Units to holders of Allowed General Unsecured
          Claims (as defined in the Plan).

          During 1998, Edison exchanged 936,138 Class B Membership Units for
          936,138 Class A Membership Units of the Company and simultaneously
          distributed such Class A units to holders of Allowed General Unsecured
          Claims.

          During 1998, the Company distributed $13.7 million to holders of Class
          A Membership Units. In addition, $0.8 million was retained for holders
          of the Class A Membership Units that were distributed in December
          1998.

          Also during 1998, certain Class A Membership Unit holders returned 278
          Class A Membership Units to Edison as such Membership Units had been
          distributed in error. The distribution proceeds relating to these
          returned Membership Units are included in retained earnings and were
          made available for future distributions to holders of Class A
          Membership Units. At December 31, 1999, Edison has no Class B
          Membership Units outstanding.

          On February 1, 1999, the Company distributed the $0.8 million of
          reserved amounts of D&B Spinoff Settlement Proceeds (as defined in the
          Plan) to the holders of the Class A Membership Units that were
          distributed in November and December 1998. This represents the entire
          amount of funds reserved for future holders of Class A Membership
          Units.

          The Company has not made any distributions to holders of Class A
          Membership units since February 1, 1999.

4.        Receipt of Settlement Proceeds

          On June 10 and July 2, 2002, the Company settled with two members of
          the Class (as defined in Item 2 herein). As a result of the
          settlements the Company collected $113,126 and $97,500, respectively,
          for a total of $210,626. There can be no assurances that other members
          of the Class (as defined in Item 2 herein) will settle or what the
          terms of any other potential settlements may be.

                                        7

<PAGE>

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

     The following is a discussion and analysis of the financial condition and
the results of operations of the Company as of and for the years ended December
31, 2001, 2000, 1999 and 1998 and as of and for the periods ended December 31,
1997, January 1, 2002 through June 30, 2002 (unaudited) and January 1, 2001
through June 30, 2001 (unaudited), and of certain factors that may affect the
Company's prospective financial condition and results of operations. This
discussion and analysis should be read in conjunction with the Company's
Financial Statements and Notes thereto included elsewhere herein and included in
the Company's Annual Report and Form 10-K for the year ended December 31, 2001.
This discussion contains certain forward-looking statements that involve risks
and uncertainties. The Company's actual results could differ materially from the
results expressed in, or implied by, such statements.

Results of Operations/Overview

     The Company, which was formed pursuant to the Amended Joint Plan of
Reorganization Under Chapter 11 of the U.S. Bankruptcy Code filed by the Debtors
(the "Plan") and the Members Agreement, is a limited purpose entity organized
solely for the purposes of (a) prosecuting, settling and/or liquidating the
Unresolved Avoidance Claims, (b) receiving and administering the proceeds from
the Unresolved Avoidance Claims (the "Avoidance Claim Proceeds"), and (c)
distributing the net Avoidance Claim Proceeds to holders of the Company's Class
A Membership Units pursuant to the terms of the Members Agreement. The Company
commenced its activities on September 25, 1997.

     On October 16, 1997, the Company received the L.L.C. Funding Amount of $2
million. The Company recognizes income from amounts received from the
prosecution, settlement and liquidation of the Unresolved Avoidance Claims. To
date, the Company has only received settlement amounts. During the period ended
December 31, 1997, the Company received approximately $10.0 million in D&B
Spinoff Settlement Proceeds. The D&B Spinoff Settlement Period was to initially
expire on October 27, 1997, at which time the Company had received approximately
$7.8 million in D&B Spinoff Settlement Proceeds. However, many defendants were
not able to accept the D&B Spinoff Settlement by the initial deadline for
reasons including, without limitation, (a) the time lag attendant to the
transmission of settlement-related documents from record holders to their
beneficial holders, and (b) the desire of certain D&B Spinoff Stockholders to
consult with counsel or other advisors prior to participating in the D&B Spinoff
Settlement. The Manager therefore decided that an extension of the D&B Spinoff
Settlement Period was in the best interests of the Company. The extension
permitted the recovery of additional D&B Settlement Proceeds of approximately
$2.2 million between October 27, 1997 and December 31, 1997, approximately $5.0
million for the year ended December 31, 1998 and none for the years ended
December 31, 2001, 2000 and 1999. The Company collected $113,126 for the period
ended June 30, 2002. The Company expects to recognize defendant payment revenue
in future periods as the Unresolved Avoidance Claims are prosecuted, settled
further, or both. However, there can be no assurance that the Company will
recognize any further defendant payment revenue.

     The Company also recognizes income from interest earned on Avoidance Claim
Proceeds. The Company invests Avoidance Claim Proceeds in a money market fund
investing solely in direct obligations of the United States Government. The
Members Agreement permits all funds received by the Company to be temporarily
invested in United States treasury bills and notes with maturities of 12 months
or less, institutional money market funds, and demand or time deposits with U.S.
federal or state commercial banks having primary capital of not less than $500
million. During the years ended December 31, 2001, 2000, 1999 and 1998, and the
period ended December 31, 1997, the Company recognized approximately $50,000,
$101,000, $92,000, $388,000 and $106,000 of interest income, respectively.
During the six month periods ended June 30, 2002 and 2001, the Company
recognized approximately $7,397 and $33,181 of interest income, respectively.
The amount of interest income recognized by the Company in future periods will
be dependent on, among other things, (1) fluctuations in interest rates, (2) the
amounts and timing of any Avoidance Claims Proceeds received in the future, (3)
the amounts and timing of any distributions to holders of Class A Membership
Units, and (4) the amount and timing of the Company's expenses.

     The Company's expenses consist primarily of fees payable to the Company's
lawyers and accountants, insurance expenses, the Transfer Agent and the Manager.
The Company had expenses of approximately $442,000,

                                        8

<PAGE>

$489,000, $299,000, $671,000 and $176,000 for the years ended December 31, 2001,
2000, 1999 and 1998, and the period ended December 31, 1997, respectively.
During the six month periods ended June 30, 2002 and 2001, the Company had
expenses of approximately $502,762 and $260,633, respectively. These expenses
are expected to fluctuate in future periods primarily based on activity in any
period in the D & B Spinoff Litigation.

     The Company and EBS Pension, L.L.C. (another limited liability company
formed pursuant to the Plan) have agreed to indemnify the Debtors (as defined in
the Plan) and their present or former officers, directors and employees from and
against any losses, claims, damages or liabilities by reason of any actions
arising from or relating to the Company and any actions taken or proceeding
commenced by the Company (other than with respect to any Unresolved Avoidance
Claims that the Company may have against such persons other than in their
capacities as officers, directors or employees of the Debtors). Indemnification
must first be sought from any applicable officers' and directors' insurance
policy, and then from the $1.5 million reserve established by EBS Pension L.L.C.
Although to date there has not been any indemnification claim, there can be no
assurance such a claim will not be made in the future. All liabilities of the
Company, including the foregoing indemnification obligations, will be satisfied
from the Company's assets.

     At December 31, 2001, 2000, 1999, 1998 and 1997, the Company had cash and
cash equivalents of approximately $1.2 million, $1.5 million, $1.9 million, $3.0
million and $12.0 million, respectively. At June 30, 2002, the Company had cash
and cash equivalents of approximately $0.9 million. During 2001, the Company
made no distributions to holders of Class A Membership Units. The Company made
no distributions during the six month period ending June 30, 2002. The amount
and timing of any future distributions of Avoidance Claim Proceeds will be
determined by the Manager in accordance with the term of the Members Agreement.
There can be no assurance as to the amount (if any) of any further distributions
that will be made.

     The Company's lawyers completed third-party discovery, including
depositions of former officers and directors of Edison, and third-party
discovery closed on March 31, 2000, pursuant to court order. On or about March
29, 2000, the Class Representatives (D&B Stock is held by approximately 2,500
different individuals and entities (the "Class"). The Class includes Barclays
Global Investors, N.A., Greentree Partners, and Greenway Partners, which are
referred to herein as the "Class Representatives.") filed a third-party
complaint against former directors of Edison (the "Edison Third-party
Defendants"), former and current directors of Dave & Busters, Inc. and against
Dave & Busters, Inc. (the "D&B Third-party Defendants" and collectively with
Edison Third Party Defendants, the "Third-party Defendants"). The complaint
purports to allege claims for breach of fiduciary duties, aiding and abetting
breaches of fiduciary duties, and for contribution or "subrogation." Because
these claims might have implicated the indemnification provisions described
above, the claims were reviewed in detail by the Company's lawyers, and found to
be without substantial merit. While there can be no assurances of the Company's
success, the Company intends to oppose joinder of these claims in the D & B
Spin-off Litigation (as defined in the Plan).

     In June 2000, the Third-party Defendants each filed a motion to dismiss the
third-party complaints against them ("Motions to Dismiss"). The Company filed a
joinder in those Motions to Dismiss. On August 21, 2000, the Court held a
hearing on the Motions to Dismiss and other matters. By Order dated as of August
28, 2000, the Court granted the Motions to Dismiss in part, and denied them in
part. The Court dismissed the breach of fiduciary duty claims and the related
claims for aiding and abetting breach of fiduciary duty, finding the claims, if
any, barred by the statute of limitations. However, the Court denied the Motion
to Dismiss the purported contribution and/or "subrogation" claim. Because of
certain inconsistencies in the Court's rulings, the Third-party Defendants moved
for clarification, reconsideration, or in the alternative, interlocutory
(immediate) appeal ("Motions for Reconsideration"). The Company filed a limited
joinder in those Motions for Reconsideration, and the Class filed its
opposition. The Court has not set a date for deciding these Motions for
Reconsideration.

     In July 2000, the Class Representatives also filed a Motion to Amend the
Order Certifying the Defendant Class ("Motion to Amend"). In this Motion to
Amend, the Class Representatives seek to add absent class members as named class
representatives. The Company opposed this Motion to Amend on the grounds that:
(i) the Class Representatives should not have been represented by Class Counsel
in the Motion to Amend against absent class members; (ii) there was no showing
of need to add named class representatives; and (iii) the adding of certain
absent class members as named class representatives could create unnecessary
conflicts for the Company's lawyers to the substantial prejudice of the Company.
Two of the proposed named class representatives, Mellon Bank and Boston


                                        9

<PAGE>

Safe Deposit, related entities, filed substantive objections to the Motion to
Amend on similar grounds. On August 21, 2000, the Court heard argument on the
issues presented by the Motion to Amend and took the matter under advisement.
The Court has not indicated when it will rule on the Motion to Amend.

     In September 2000, the Company filed a motion with the United States
Bankruptcy Court, District of Delaware to reopen the bankruptcy case of Edison
Brothers Stores, Inc. for the limited purpose of extending the term of the
Company. Section 1.4 of the Company's Members Agreement limits the Company's
existence to three years subject to extension(s) approved by the Bankruptcy
Court for good cause shown. Therefore, the Company's existence was set to expire
on September 26, 2000 unless extended by the Bankruptcy Court. In its motion,
the Company argued that the Company's members would be best served by permitting
the Company to remain a going concern. The Bankruptcy Court granted the
Company's motion to extend the existence of the Company for an additional
two-year term.

     On January 22 and 23, 2002, the D&B Spinoff Litigation was tried before
Judge Robinson in the United States District Court for the district of Delaware.
It is anticipated that the Court will decide the case at some point in calendar
year 2002. The Company continues to prosecute the D&B Spinoff Litigation
vigorously, and to pursue the maximum available recoveries. While there can be
no assurances as to the Company's ultimate total recovery given the
uncertainties associated with litigation, at this juncture it is estimated that
such recoveries will exceed the costs of further prosecuting the D&B Spinoff
Litigation.

     On June 10, and July 2, 2002, the Company settled with two members of the
Class. As a result of the settlements the Company collected $113,126 and
$97,500, respectively, for a total of $210,626. There can be no assurances that
other members of the Class will settle or what the terms of any other potential
settlements may be.

     The Company is classified as a partnership for federal income tax purposes
and, therefore, does not pay taxes. Instead, the Members pay taxes on their
proportionate share of the Company's income.

Quarterly Results

Six Months Ended June 30, 2002 Compared to the Six Months Ended June 30, 2001

     Total income for the six months ended June 30, 2002 and 2001 were $120,523
and $33,181, respectively. This increase is due primarily to the collection of
the settlement proceeds mentioned above.

     Total expenses increased for the six months ended June 30, 2002 as compared
to the six months ended June 30, 2001 by $242,129 due primarily to an increase
in legal and accounting fees due to the increase in litigation activity during
the period and efforts to resolve settlement issues.

                                       10

<PAGE>

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings.

     Other than the D&B Spinoff Litigation referenced elsewhere herein, the
Company is not involved in any legal proceedings.

Item 6.  Exhibits and Reports on Form 8-K.

               (A) Exhibits      Description
                   --------      -----------

                        2.1*     Amended Joint Plan of Reorganization of Edison
                                 Brothers Stores, Inc.

                        3.1*     EBS Litigation, L.L.C. Certificate of Formation

                        3.2*     EBS Litigation, L.L.C. Membership Agreement

     *    Incorporated by reference to the same numbered exhibit filed with the
          Registrant's Registration Statement on Form 10 originally filed with
          the SEC on July 29, 1998 (SEC File No. 000-24711).

     (B)  Reports on Form 8-K

               None.

                                       11

<PAGE>

                                   Signatures

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                                      EBS LITIGATION, L.L.C.



                                                      /s/  PETER N. WANG
                                                      --------------------------
Date: August 13, 2002                                 Peter N. Wang, Manager


                                       12