thq-bankruptcy
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THQ sues EA, UFC: EA fed inside info to UFC owner, THQ says
THQ has sued EA and UFC parent company Zuffa, claiming EA intentionally damaged THQ's relationship with Zuffa to broker a deal of its own for the UFC license. THQ claims EA used inside knowledge about its financial situation to commit "tortious interference" with its contract, and THQ is seeking to recover the value of the UFC property, the profits of the UFC franchise and at least $10 million in damages from EA. The suit also aims to disallow Zuffa's bankruptcy claims against THQ. In early December 2011, EA considered buying THQ outright and the two companies entered negotiations, according to THQ's suit filed with the Delaware district court. THQ says it provided EA with detailed financial information, including revenue and projected stats on its UFC franchise. On December 12, 2011, EA walked away from the potential buyout, and on December 30, 2011, Zuffa sent THQ a Demand Letter expressing the intent to terminate the UFC license. Though the UFC franchise was worth $20 million, THQ settled with Zuffa for $10 million. EA snagged the UFC license in 2012. EA Sports UFC is due out in 2014 for Xbox 360 and PS4. On December 19, 2012, THQ filed for bankruptcy. Looking back, THQ puts the pieces together as follows: "Prior to the Demand Letter, EA contacted Zuffa, informed Zuffa of THQ's perilous financial condition and expressed interest in acquiring the UFC franchise directly from Zuffa, causing Zuffa to threaten termination of the UFC license." An EA spokesperson tells Polygon, "We believe these claims are without merit."
THQ receives approval to liquidate
Never forget that Death was THQ's final protagonist. Late yesterday, the US bankruptcy court in Delaware approved the liquidation of Toy Head Quarters (THQ). Unless you're a creditor seeking some kind of back-pay or compensation, this is likely the last you'll hear about THQ. As Bloomberg reports, from here on out it's a scramble for whatever cash exists from the multiple intellectual property and asset auctions the company went through. Depending on what happens during several hearings scheduled over the next three months, creditors could receive 20 percent to 52 percent of what they are owed. The percentages noted could be on an even wider sliding scale based on other factors the lawyers and accountants are sure to enter an octagon over. The current estimate on claims is between $143 million to $184 million. RIP, THQ.
Interplay retrieves Freespace IP from THQ for $7,500
Freespace, the interstellar combat series developed by Volition and published by Interplay, is now back in Interplay's library, fully and officially, following a stint at THQ. Interplay paid $7,500 to snag the Freespace rights in a THQ bankruptcy sale this month. THQ was bound to find some emotionally rich items in the back corners of its closet eventually – but Freespace wasn't going to save the company, it seems. Interplay never lost the right to sell Descent: Freespace and Freespace 2, even after THQ bought Volition in 2000, when Interplay itself neared bankruptcy. Let the rampant sequel speculation begin.
Double Fine wants to win back Stacking, Costume Quest rights
Double Fine wants to tie up all of the loose ends within its catalog and is seeking the distribution rights to its games formerly published by THQ, Stacking and Costume Quest. Nordic Games picked up the distribution rights to these games during THQ's bankruptcy auction in April, though Double Fine attempted to secure the rights from THQ as early as February. Double Fine owns the intellectual properties for Stacking and Costume Quest, so if it wants to make new games within each series, it can. "We're still trying to get the rights to Costume Quest and Stacking," Schafer told Game Informer. "We can still make more of those games. We still have the IP, but we'd love to have all of the IP and distribution rights in house." On top of those distribution rights, Double Fine wants to regain the Brutal Legend IP from EA and the Iron Brigade IP from Microsoft, Schafer said. These are difficult positions for Double Fine, but for us, deciding which war to watch is just as hard: Battle of Heavy Metal and Mechs or the Battle of Kids in Costumes Playing with Toys From the Old Country. Decisions, decisions.
Ubisoft fired another THQ Montreal veteran yesterday, Desilets says
Ubisoft fired original Assassin's Creed creative director Patrice Desilets yesterday, after his rocky transition from Ubisoft, to THQ Montreal and back to Ubisoft. One of his colleagues, Jean-François Boivin, was also fired yesterday, Desilets tweeted. Boivin traveled from Ubisoft to THQ Montreal, before being pulled back in at Ubisoft, just as Desilets did. "Thinking of my good friend and producer @JFBoivin who also got fired yesterday," Desilets wrote. "I'm sharing your support with him." Boivin's LinkedIn profile says he joined Ubisoft in 2005 and held a variety of production roles – including production manager for Assassin's Creed and Assassin's Creed 2 with Desilets – until 2011, when he joined THQ Montreal to work on a new IP. Desilets left Ubisoft in 2010 and began work at THQ Montreal after a one-year non-compete agreement. When the agreement was up in 2011, THQ brought over three people from Ubisoft, whom Desilets said he needed. During the THQ bankruptcy auction in January, Ubisoft bought THQ Montreal, effectively rehiring Boivin and Desilets. There's no word if Boivin's firing was as dramatic as Desilets'.
Nordic Games involved with THQ since January, is talking sequels
Nordic Games picked up most of the IPs in THQ's back catalog auction, dishing out $4.9 million for Darksiders, Red Faction, MX vs ATV, Titan Quest and a slew of unannounced games from THQ's long list of for-sale properties. Nordic was a surprise to some, especially next to Gearbox, which picked up the Homeworld franchise, and 505 Games, which snagged Drawn to Life and its sequel. But Nordic isn't new."We've been in conversation with THQ since January," Nordic CEO Lars Wingefors told Game Informer. "We signed all the NDAs in January."Wingefors has been in the gaming industry for 20 years, he said, and has handled "a lot" of THQ products during that time. In November 2011, Nordic acquired publisher JoWood, in charge of Painkiller and Torchlight, and also ended up with Canadian publisher Dreamcatcher, spawning Nordic's publishing focus.Nordic took part in the first THQ auction as well, which sold off properties such as Saints Row and some development studios for upwards of $20 million. That sale was too rich for Wingefors: "Saints Row went for $22 million and Koch bought that development studio with that burn rate on a daily basis. Even though I do have financial resources, I don't have those kind of resources."Wingefors didn't want a studio. Nordic is a "middle man" looking for the right team to make some new sequels; there's already been plenty of interest in Darksiders, he said."We have to be very honest," Wingefors said. "I am a business man within the games industry. We are not the creative, talented developer that brings out new versions in house. I understand the potential of the IPs. I respect the original creators and the creative people who are able to create sequels. In the past 24 hours, we have been contacted and there have been a few discussions (but I can't confirm names)."Nordic took home more than 50 former THQ games, but has yet to release the full list."As we still have some open points with regards to a couple of titles we will not publish a comprehensive list at this stage," a Nordic Games representative told Joystiq yesterday. "However, once everything is fixed and the ink is dry – around mid-May – we will go out with a comprehensive list of titles which we have acquired in the process."Nordic will hold talks this summer with different developers, during E3 especially. Don't expect any sequels too soon, though."You won't see a new Darksiders this year," Wingefors said. "I don't believe in bringing out a shitty sequel."
THQ auction results: Nordic Games takes Darksiders, Red Faction; 505 Games is Drawn to Life
The THQ back catalog auction results are in, with Nordic Games riding away with the intellectual property (IP) rights to Darksiders, Red Faction and MX vs. ATV for $4.9 million. The company picked up nearly all the assets in the auction, including Titan Quest, Supreme Commander, Frontlines, Stuntman, Juiced, Full Spectrum Warrior, Destroy All Humans and much more. "First and foremost we are very happy about this deal which also turns over a new leaf for the entire Nordic Games Group. In the long term, we either want to cooperate with the original creators or best possible developers in order to work on sequels or additional content for these titles," said Nordic Games CEO Lars Wingefors. "A very important point for us is not to dash into several self-financed multi-million dollar projects right away, but rather to continue our in-depth analysis of all titles and carefully selecting different financing models for developing new instalments of acquired IPs." The other reveal is 505 Games grabbed the rights to Drawn to Life and Drawn to Life: The Next Chapter for $300K. The news follows this afternoon's unexpected acquisition of the Homeworld franchise by Gearbox Software. We now know the price tag for Gearbox to re-release the original games on digital distribution networks and take a swing at its own spin on the real-time strategy franchise was $1.35 million. We've listed the winning bids in greater detail after the break.
Homeworld intellectual property purchased by Gearbox Software
Gearbox Software, best known for the Borderlands series, has purchased the rights to the Homeworld intellectual property during the recent THQ back catalog auction round.Gearbox Chief Creative Officer Brian Martel has "great love and respect for Relic's brilliant, fun and innovative game and personally spearheaded the acquisition," according to a studio statement.The company's subspace communication continues: "Brian intends as first priority to direct Gearbox's interest to preserve and assemble the purest form of the original acclaimed and beloved games, Homeworld and Homeworld 2, with the intent of making them accessible on today's leading digital platforms."The Homeworld series was originally developed by Relic Entertainment, which was purchased by Sega during a previous round of the THQ bankruptcy auctions.It is unclear at this time if Sega bid on Homeworld. We do know that Galactic Civilization developer and Sins of a Solar Empire publisher Stardock was in the running. CEO Brad Wardell tweeted us, "I'm surprised. I was wondering who had outbid us. It'll be interesting to see what they do with it. As long as I get [Homeworld 3]!"
THQ owed WWE $7.6 million, disclosure statement reveals
A recent disclosure statement filed by THQ revealed details of the terms the publisher came to with the WWE and series developer Yuke's when the publisher folded. At the time of THQ's bankruptcy filing in December 2012, it owed approximately $7.6 million to WWE for marketing and royalties expenses, as well as $15 million to $20 million to Yuke's.According to the statement, THQ, WWE and Yuke's all signed termination agreements on February 12, 2013 that relieved THQ of responsibility in paying WWE and Yuke's of those claims. THQ agreed to pay WWE royalties for sales of WWE games during its Chapter 11 case, and will also pay Yuke's $250,000 in settlement for royalties from sales during the time of its bankruptcy filing.As a result, WWE and Yuke's terminated existing contracts with THQ in order to pursue a publishing agreement for future WWE games with Take-Two. Damage claims against THQ that were eliminated as a result of the termination agreement "may have exceeded $60 million," according to the document.
Final THQ auction raised $6-7 million, details expected Monday afternoon
A recent disclosure statement on defunct publisher THQ notes the back catalog auction round for the company's intellectual properties (IP) received 17 final bids and is expected to generate $6 million to $7 million."The final news will be out Monday afternoon," a person with knowledge of the proceedings informs Joystiq.This final auction, which included the IP rights for franchises Darksiders, Red Faction and Homeworld, began on April 1 and ended on April 15. The disclosure document notes the plan is to present the sales to the bankruptcy court for approval in May and close the sales by the end of the month.A prior auction saw the purchase of franchises Saints Row, Company of Heroes and Metro.
Multiplayer shooter Nexuiz tied up in the future of THQ Partners
Nexuiz, an arena-based product of Illfonic and THQ Partners, is in limbo following THQ's bankruptcy and assets sale, during which the Partners brand was not sold."Our deal with THQ was basically a licensing deal through THQ Partners, so we do have a period of time [in which] THQ has the rights to be the exclusive publisher," Illfonic president Chuck Brungardt tells Polygon. "Now with them folding we are still trying to figure out what this means and awaiting details from our contacts handling the transitions at THQ."Brungardt says it will probably take another month to figure out the future of Nexuiz and the remaining THQ assets. Nexuiz is lumped in with THQ Partners, the Darksiders franchise, Vigil Games and other back catalog properties that former THQ president Jason Rubin said will be sold off in a separate process.
THQ formally drops Farrell, Rubin, executive staff
THQ's storybook is down to the final pages, following the rising action of its dropping stock, and the climax of its bankruptcy at the end of 2012 and asset sale in January. Now for the falling action: THQ formally terminated CEO Brian Farrell, President Jason Rubin and Chief Strategy Officer Jason Kay on January 30, made public in an 8-K form filed today.Earlier in February, Rubin said that THQ's failure was its own fault, and it boiled down to missteps with franchises such as uDraw, the Warhammer 40K MMO and Homefront. "THQ had every chance to survive, had it not made massive mistakes," he said.THQ's epilogue is up next, wherein we find out what all these new companies will do with its former properties.
THQ memo asks employees to pack up today
Employees of THQ's corporate HQ and Vigil studio will conclude working for the bankrupt publisher today. In a memo obtained by IGN, employees received a "frequently asked questions" memo regarding the end of their employment.The memo notes employees should remove all personal items by the end of the day, as access to the building will be shut off today. Employees will be paid through today, have health insurance until January 31, with severance and leftover vacation day pay yet to be determined. All stock is worthless.An auction was held this week to sell off most of THQ's assets, with the publisher's intellectual property and some studios picked up by other companies. Another auction is planned to handle whatever's left over.
THQ 'back catalog' to be sold off in 'separate process'
THQ sold off much of its intellectual property, and existing catalog, yesterday in an auction. But what about all the THQ IP that wasn't included, like Darksiders and (why not) uDraw? THQ president Jason Rubin told Game Informer that other sales of legacy holdings will be forthcoming."There will be a separate process to sell off the back catalog and IP," Rubin said. "That process will take place in the coming weeks." Rubin did not say what form the "process" would take, whether it will involve private individual deals or further auctioning.
Court approves THQ asset sales
The U.S. Bankruptcy Court has approved the sale of THQ's assets to Ubisoft, Sega, and other companies, THQ announced this morning. The sales are all expected to close today. THQ totals the proceeds from the sale at $72 million, making a total of $100 million when added to the company's estimate of its remaining assets.In a statement issued by THQ (sure to be one of the last), CEO Brian Farrell said "While we had hoped that the restructuring process would allow the company to remain intact, I am heartened that the majority of our studios and games will continue under new ownership."New president Jason Rubin echoed the sentiment. "I was brought in eight months ago to help turn this ship around," Rubin said, "and while I'm disappointed that we could not effect a sale for the entire operating business, I am pleased that the new buyers will be providing jobs to many of our very talented personnel. When we first announced the sale process, I said I would be happy if the company's games and people had a bright future, even if it meant I did not have a job at the end of it. And I still feel that way."
Report: THQ's WWE license going to Take-Two
While most of THQ's coffers have already been cleaned out, there's been no official word on any party making a move on the WWE license. An IGN source suggests Take-Two will take over the WWE line of games. The negotiations for the WWE license apparently took place outside of the formal THQ auction, IGN notes. According to documents obtained by Joystiq, Take-Two has already spent $10.9 million snagging Turtle Rock's Evolve from THQ.
New THQ Montreal game in auction filing: Underdog
The results from THQ's auction reveal not only how much its studios and IPs were worth to other companies, but also an unannounced game: THQ Montreal's Underdog.Ubisoft placed the only bid for THQ Montreal, snagging the studio, Underdog and 1666 for $2.5 million. The filing doesn't list any details about either game, though 1666 has shown up in previous THQ bankruptcy documents.The auction results reaffirm the existence of Evolve (aka Metamorphosis), a co-op multiplayer action game from Turtle Rock Studios, and reveal that it runs on Crytek's CryEngine 3.See the entire roundup of bids for former THQ studios and IPs in our THQ winners and losers post.
THQ bid winners, prices and runners-up
Joystiq has obtained details on the winning auction bids for the various THQ intellectual properties and licenses made available during the company's bankruptcy auction. We've listed the winning bids and runners up below.To clarify, we've noted whether the asset is a studio, intellectual property (IP) or license.Relic (studio) and Company of Heroes (IP)Winning bid: $26.6 million - Sega CorporationBackup bidder: $26.3 million - Zenimax MediaTHQ Montreal (studio), with 1666 (IP) and Underdog (IP)Winning bid: $2.5 million - UbisoftBackup bidder: N/A
Report: THQ assets divided
The THQ auction has resulted in the company's assets being distributed among several publishers. Developer Volition and the Saints Row franchise, along with the Metro license, have been purchased by Dead Island publisher Deep Silver. Relic Games (Warhammer 40K, Company of Heroes) has gone to Sega. The South Park game and THQ Montreal have been purchased by Ubisoft. Take-Two Interactive has purchased Evolve.Vigil and other unnamed THQ properties not included in the sale will "remain part of the chapter 11 case," and THQ will look for buyers. According to a letter sent to employees, "If you are an employee of an entity that is not included in the sale, we regret that your position will end."Update 2:Official court documents of THQ bid winners with prices, along with runners-up.Update: DDinvesting reports THQ auction results: $500k Homefront (Crytek) $26M for Relic (Sega) $2.5M for THQ Montreal (Ubisoft) $3.2M for South Park (Ubisoft) $11M for Evolve (Take-Two) $22.3M for Volition (Koch Media) $5.8M for Metro (Koch Media)
South Park Studios battles THQ over potential sale of The Stick of Truth
On January 18, South Park Digital Studios filed a preliminary objection to THQ's proposed sale of South Park: The Stick of Truth. THQ and South Park Studios entered into a Deal Memo, granting THQ use of certain South Park trademarks and copyrights, on June 29, 2011. THQ filed for Chapter 11 bankruptcy on December 19 and is being auctioned off today, January 22, at 3 p.m. EST.In an objection filed in Delaware bankruptcy court, South Park Studios claims that the Deal Memo does not allow other parties use of the South Park IP, and even if the game does end up at a different company, THQ owes South Park Studios at least $2.275 million. South Park Studios "also reserves the right to exercise its option to acquire from THQ all elements of the games and related products under the Deal Memo."THQ filed a reply on January 21, requesting that the court overrule the objection and allow the sale to continue, though it says it is working toward a consensual resolution with South Park Studios. THQ argues that the license is exclusive and therefore transferable as THQ sees fit. As for the $2.275 million, THQ is "evaluating the amount that South Park asserts is owing" and plans to work with South Park Studios to resolve the issue.All bids in the THQ bankruptcy sale were due by 9 a.m. EST today and the auction begins at 3 p.m. Hearing on the sale takes place tomorrow, January 23, at 9:30 a.m., with the closing on January 24. THQ will only sell assets individually if it receives bids of more than $60 million (plus a $10 million note) that Clearlake Capital Group is offering for the entire company. The auction has attracted the attention of EA, Warner Bros., Double Fine and others.
