Marvelous Sued for 'Poaching Employees' and a 'Hostile Takeover Attempt'

November 1, 2012 -

Indie game studio Checkpoint has filed a lawsuit against Japanese publisher Marvelous AQL in a California court claiming that the company tried to initiate a hostile takeover and steal its employees in order to avoid a $2.5 million payment. The news comes from an extensive report on the case over at Gamasutra.

The lawsuit was filed earlier this month by Checkpoint CEO Brian Wiklem. According to the claim Marvelous paid his studio Checkpoint a total of $2.5 million in start-up costs in exchange for a 35 percent share of the privately-owned company and two shipped games by the end of 2012. The deal was made late last year, according to the complaint.

Under the terms of the deal, Wiklem would retain the remaining 65 percent and Marvelous would later negotiate a similar deal in good faith for another $2.5 million to ship more titles in 2013. The two games in question - AviNation and Party Politics - were released, but Wiklem claims that Marvelous refused to negotiate for 2013, and has also withheld other unrelated payments.

Instead of negotiating a second deal, the suit alleges that Marvelous and former Checkpoint CTO Christopher Masterton "conspired to try to engineer a hostile takeover of Checkpoint." Masterton held a 24 percent share in the company, according to the complaint. Masterton supposedly flew out to Japan in September to meet with Marvelous "without notifying Wiklem," and allegedly planned to sell his shares to give Marvelous a majority ownership of the studio.

Wiklem contends that the contract his company signed with Marvelous makes it so that Marvelous needs permission from him to purchase those shares without Wiklem's consent. He also contends that they wouldn't have had control of the board anyway because Masterton's shares did not have any voting rights.

Instead of buying those shares, Wiklem claims that Marvelous hired Masterton to work at its U.S. subsidiary, XSeed, as well as 14 other key developers from Checkpoint, leaving the company a ghost town and unable to ship product. The suit also claims that the former employees are illegally using Checkpoint-developed technology and assets over at XSeed.

The suit goes on to claim that Checkpoint has been damaged by "at least $5 million."

Checkpoint's suit names Marvelous, Masterton, XSeed and ten unnamed parties on several counts, including a breach of contract, a breach of Marvelous and Masterton's fiduciary duties as board members, and the theft of trade secrets, among other claims.

Source: Gamasutra


 
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