Close
Are you sure? Are you sure you want to report this comment? I understand, report it. Cancel

Jowood files for insolvency

Mon 10 Jan 2011 9:12am GMT / 4:12am EST / 1:12am PST
LegalPublishing

Austrian publisher also suing Koch for $3m

Publisher JoWooD has announced that efforts to shore up its capital and equity have failed.

The Austrian firm filed for insolvency last Friday, asking Vienna's commercial court for a procedure of capital reorganisation.

However, the board believes JoWooD will continue, claiming it can conclude successful discussions with investors and creditors "within 90 days."

Simulataneously, JoWooD is pursuing a lawsuit against fellow publisher Koch Media BmbH, claiming the German firm had underpaid for 6.4 million JoWooD shares in 2006.

The shortfall is claimed to be 2.36 million ($3.04 million), plus interest. The underpayment was perhaps not committed knowingly, JoWooD having itself recalculated the worth of accounts receivables offered by Koch in exchange for the shares. Austrian corporate law stipulates that Koch could be liable for the shortfall "irrespective of fault."

JoWooD and Koch have been in court before, but settled their disputes in 2008. Despite this, "With a view to JoWooD's strained financial situation and based on corporate law considerations, the company's management board today decided to file the law suit in the company's and its shareholders' interest."

The company also suggests that "a final court decision will be rendered only after tedious proceedings that could last for several years" - perhaps hoping to lure Koch into an earlier settlement.

12 Comments

It seems that in struggling economy it's less expensive to pay German lawyer instead of paying for contractual obligations. First Playlogic, then Apogee, now JooWooD... That's not cool!

Posted:3 years ago

#1

Private
Industry

1,176 182 0.2
Well in Germany and Austria the looser has to pay the fees for lawyers.

Doesn`t look like Koch didn`t stick to contractual obligations, but more like JoWood made some wrong calculations initially and they figure that out 4 years after they sold the shares to Koch.

Given that JoWood has financial problems since ages it might be better to just close the doors once and for all. They lost most of their reputation in recent years and since 2001 or 2002 it`s going constantly downhill because they stay open just barely and have frequently to fight of bankruptcy. Probably one of the reasons why their games are so full of bugs because they have to make always somehow money to stay afloat and can`t wait to have games actually finished.

Posted:3 years ago

#2
How was the reception with Arcania?

Posted:3 years ago

#3

Private
Industry

1,176 182 0.2
A metacritic of 63 with 20 reviews

Posted:3 years ago

#4

Stephen Venables
Producer

5 0 0.0
JW themselves have a poor record for paying their contractual obligations. I've heard that one of their methods for generating some cash in this current crisis has been to attempt legal action against ex-employees for real (and fictional) errors made. I was notified of this by an ex-colleague as I also worked there previously and he thought to give me a heads up.
Personally I think JW should just do everyone a favour and close its doors. They're desperate and have been for a good few years.

Posted:3 years ago

#5

Franz Hess
Executive Producer & Managing Director

7 0 0.0
awesome.. nearly one year after Koch closed Deep Silver Vienna.. conspiracy detected!

Posted:3 years ago

#6
Well, they deserve one another.

Posted:3 years ago

#7

Eilert Behrends
Aiborn Wild Ass

1 0 0.0
Well according to German business law Koch Media might never have to pay anything if Jowood themselves have published that information. They could be held liable for business-damaging behavior, plus they need to find a court willing to judge on a four year old case, where both partners seem to have overlooked 2 million EUR just like that ;-)

Posted:3 years ago

#8

Private
Industry

1,176 182 0.2
Well Stephen, in a fair world someone would sue the board for years of mismanagement. I don`t know how the shareholders can just sit there and look at how their investment slowly crumbles to zero and don`t seek to get the full board replaced with people who actually have an idea about how to run a games business.

Posted:3 years ago

#9
The term clutchin at straws comes to mind

Posted:3 years ago

#10

Michael Wiessmuller
Managing Director & Business Development

18 1 0.1
They have been hanging on by their fingernails for years. I for one am glad to see them go, they have represented some of the worst of the games industry for a long time now. Obviously feel sorry for the "innocent" employees caught in the crossfire. Developers caught in this - you know who you are - shouldn't have done business with them in recent years anyway, but I hope they haven't been hit too hard too. Anyway I hope this is the end of this highly unpleasant chapter of the german speaking games industry.

Edited 1 times. Last edit by Michael Wiessmuller on 10th January 2011 7:54pm

Posted:3 years ago

#11
Wouldn't be the first time and probably will not be the last time for Jowood, IMHO.

Posted:3 years ago

#12

Login or register to post

Take part in the GamesIndustry community

Register now