The Weekly Dish – Modern Courtfare

The Weekly Dish – Modern Courtfare

Industry watchers have been awaiting the trial between Activision and a number of ex-Infinity Ward employees for a couple years. Read on to learn the latest on the upcoming court battle, along with plenty of other news from around the gaming world.

It's Nice to Feel Justified

Last week I acted with suspicion towards claims that this April's game sales were particularly dismal. I noted that the boxed game sales tracked by the NPD group don't show anything close to the full picture when it comes to today's gaming market. This week the NPD itself backed up my suggestion, showing that once items such as digital downloads, rentals, and social/mobile gaming were added into the mix, over a billion dollars were generated from game sales in the United States. I hope the NPD will continue to embrace this more all-encompassing definition of game sales so we can get a more accurate idea of how the game industry is doing going forward.

The Weekly Dish – Modern Courtfare

Square Enix Stops Bleeding Money

Japanese RPG behemoth Square Enix has been having financial difficulties lately, a situation that has been explored by many a "Is the Japanese RPG dead?" editorial over the past few years. It looks like the company is turning things around, thanks in part to its acquisition of Eidos. Strong sales of Deus Ex: Human Revolution and Final Fantasy XIII-2, along with success in the mobile gaming market, allowed Square Enix to post a $76 million profit for the 2011-2012 fiscal year.

Was the past year a fluke, or can Square Enix turn around its inefficient Japanese operation and continue to reap benefits from Eidos? It could be a rough year for the company, with no release in sight for huge upcoming projects like Kingdom Hearts 3 and Final Fantasy Versus XIII. Perhaps this summer's massive redesign of the online boondoggle, Final Fantasy XIV, will be successful, or perhaps Tomb Raider will come out in early 2013, in time to boost profits before the end of the fiscal year. Personally, I just want to know when we're going to see something of Thief 4. We know you're working on it, Eidos Montreal...

Modern Courtfare 2

One of the game industry's biggest legal sagas is coming to a head very soon. For those who haven't been keeping track of the Activision/Infinity Ward lawsuit, here's the Reader's Digest version. In March of 2010, Activision fired two lead developers from Infinity Ward, the Call of Duty studio. Forty Infinity Ward employees quit soon after, many moving on with West and Zampalla to form a studio under Electronic Arts. West and Zampalla then sued Activision for wrongful dismissal and for breach of contract, as both they and the employees who quit with them were owed bonuses and royalties from Modern Warfare 2. In response, Activision sued EA, claiming that EA conspired to steal West and Zampalla away from Activision while they still had two years left on their contract.

With the court date of the lawsuit looming, Activision has been working to settle some of its legal issues out of court. It has settled with Electronic Arts, removing EA from the lawsuit and causing Zampalla and West's lawyers to comment that they doubted Activision ever had proof of any kind of EA conspiracy. Activision has also paid out $42 million of the royalties owed to its former employees, though in the suit they are seeking quite a bit more in royalties and damages.

The main beef here remains Zampalla and West's wrongful dismissal and breach of contract claim against their former employer. Activision's lawyers recently sought to postpone the trial by thirty days, but were denied, so the trial should begin on May 29. It sounds like there will be some interesting courtroom drama involved, as details of a recent deposition were recently released to a reporter by Zampalla and West's lawyers. In the deposition, it was revealed that Activision went to some fairly extreme lengths while investigating the two employees prior to their dismissal. Along with instructing its IT chief to access Zampalla and West's work computers and e-mails (which involved asking Microsoft to crack their passwords, a request Microsoft refused), Activision apparently considered extreme measures such as faking a fumigation or fire drill in order to clear out the Infinity Ward offices and access information found within them. Creepy.

Industry watchers such as myself are sure to be following the progress of this trial closely, so stay tuned over the summer to see what happens!

The Weekly Dish – Modern Courtfare

Bumps in the Road

Even big, successful game companies encounter bumps in the road. Just about everybody has heard about the server issues marring the release of Diablo III this week. Critics of the company are calling out the game's always-on Internet requirement for keeping people from enjoying even the single-player campaign while the servers were crashing. Will this convince Blizzard to abandon that kind of policy in the future? Sadly, probably not.

A newer game company seems to be having its own bumps in the road as well. 38 Studios, the developer of Kingdoms of Amalur: Reckoning and the future Copernicus MMORPG, took out a large loan from the state of Rhode Island in exchange for locating offices in the state. 38 has been having difficulties making its loan payment and is in danger of defaulting. The studio attempted to make a loan payment on Thursday, in the process failing to pay its employees for the week and letting its contract staff go. The check was returned, however, as Rhode Island determined that the company didn't actually have enough cash to cover the payment.

What happened to 38 Studios? Although Reckoning sold well for a new IP, its sales likely couldn't offset the major costs of developing an MMORPG. Hopefully 38 Studios can secure more funding and find a way to repay its loan, as Reckoning was a promising start for the young company.

Becky Cunningham
Contributing Writer
Date: May 18, 2012

*The views expressed within this article are solely the opinion of the author and do not express the views held by Cheat Code Central.*

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