Battle Royale for Playstation seems likely to have been a game trying to cash in on some multi-franchise-combining "Smash Brothers" like action. At one point, it was rumored that they wanted to do a toy line to promote the game with display figures. Also, here to bend the rule of prototypes again, is CG Shadow.
He was meant to be a DLC special character for the game, but he got scrapped when something went wrong during development. Here, you can see some unfinished sprites of how he would have looked. The top one isn't lit / final, while the bottom one is totally uncolored. They do look good though, and the character probably could have been interesting to have in the game. It's also kind of too bad that figures weren't done as well. (Though Smash Brothers is set to get figures, which will probably lead to a Sonic one at some point, as part of that line.