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Activision pays out $42m in Infinity Ward case, lawsuit continues

Activision pays out $42m in Infinity Ward case, lawsuit continues

Tue 15 May 2012 6:10am GMT / 2:10am EDT / 11:10pm PDT
BusinessLegal

Former Infinity Ward developers get a check, but say it's not enough

The high-profile legal battle over royalties owed to former Infinity Ward co-founders and developers over Call of Duty: Modern Warfare 2 took an unusual turn today, as Activision sent a check for $42 million to the Infinity Ward Employee Group (IWEG).

Bruce Isaacs, attorney for the group, told Polygon that they plan to continue the lawsuit to get the rest of what they feel they are owed. Activision is now seeking to delay the scheduled May 29th start of the trial for another 30 days so that its new lead attorney, Beth Wilkinson, can get up to speed.

The payment came after the end of the discovery period in March, where all evidence for the upcoming trial has been collected. Activision, upon reviewing the evidence, decided that the Infinity Ward Employee Group was not complicit in the secret talks that Infinity Ward co-founders Jason West and Vince Zampella were holding with Electronic Arts, and that a payment to the group was warranted.

Bruce Isaacs confirmed that the payment had been made, calling it a "cynical attempt to look good before the jury trial." Isaacs continued, "I can confirm for you that it happened today. I can also tell you that although it is a meaningful payment it is only a small portion of what we are seeking in litigation. It is outrageous that they made us wait, they obviously knew they owed the money and this just shows that they breached the contract."

"The damages claim by West and Zampella has increased from the $36 million in 2010 to more than $1 billion today"

The $42 million which included 10 percent interest, is in addition to the $22 million already paid for the first quarter launch bonus. The damages claim by West and Zampella has increased from the $36 million in unpaid royalties the pair first sought in 2010 to more than $1 billion today.

Call of Duty: Modern Warfare 2 was initially released in November of 2009, and set new sales records for entertainment software, helping Activision pass up Electronic Arts to become the biggest entertainment software publisher. The title had sold more than 20 million units by June of 2010, and Infinity Ward claims their contracts with Activision entitled them to large bonsues based on sales. In an SEC filing on May 9, Activision said that the 40 members of the IWEG were seeking as much as $350 million in compensatory damages.

Activision lost a key ruling on May 2, as it sought to keep the jury from hearing testimony by a former IT employee who was asked by Activision's in-house counsel to "dig up dirt" on West and Zampella.

Activision, in a cross-complaint, alleges that Electronic Arts conspired with West and Zampella to leave Activision and take key Infinity Ward employees with them. Activision is seeking $400 million in damages from Electronic Arts for the cost of rebuilding Infinity Ward.

The IWEG feels that Activision owes it from $75 million to $125 million, as well as an additional $75 to $500 million in punitive damages, according to Isaacs. He told Polygon that IWEG is continuing the suit against Activision. "They are just as interested as they were before hand," Isaacs said. "We are seeking all kinds of bonuses per the contract. This payment relates to one particular game and one particular time period and one particular bonus."

6 Comments

Peter Dwyer Games Designer/Developer

482 293 0.6
It looks like the last set of attorneys went over the evidence and pretty much said you've lost and you owe them the cash.

Not suprising really as, even though I don't like the infinity ward founders, they did have the right to get paid what they were owed and not be back stabbed just so Activision could steal the franchise.

Posted:2 years ago

#1

Dominic Jakube Student

92 13 0.1
If this maybe an way of sabotaging Respawns new game?The Infinity Ward Employee Group are mostly employed by Respawn and now they get huge bounuses.
If you recevied a check for say half a million would you turn up for work or quit?

Edited 1 times. Last edit by Dominic Jakube on 15th May 2012 8:46am

Posted:2 years ago

#2

Sam Brown Programmer, Cool Games Ltd.

235 164 0.7
If you recevied a check for say half a million would you turn up for work or quit?

I'd turn up for work. In a Ferrari, but I'd turn up. :) I like to think that I do this job because I like it, not because I might get rich.

Posted:2 years ago

#3

John Donnelly Quality Assurance

313 38 0.1
I would also turn up as well.
These days 1/2mill wont go very far if you factor in hour prices in some areas, taxes and other bills and what not.

Posted:2 years ago

#4

Thomas Dolby Project Manager / Lead Programmer, Ai Solve

342 293 0.9
@Dominic
500K may seem like a lot of money but no-one in their 20s or 30s could retire off that and live comfortably. Personally even if I received 2 million I wouldn't quit my job, I love it too much. In fact I'd probably help fund some of the projects we do if anything. But if you mean quit and start up a company yourself, then maybe.

Posted:2 years ago

#5
With a windfall, it's a chance to reinvest and make sweet lovin and games in no particular order

Posted:2 years ago

#6

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