OK, we figured it out. For anyone else encountering this problem, the patches are not cumulative. I was on 1.10 and my friend was on 1.11. Make sure you keep hitting the TrueUpdate button until there are no more patches left to install.

<t> My friend and I both recently purchased the game and patched up to 1.11 using TrueUpdate. Single-player games work fine for each of us.<br/>
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He created a PBEM game, using the 12-turn scenario and default settings (unsecure). He took his turn then sent it to me. When I try to open the ...