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

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."

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Steve Peterson avatar

Steve Peterson

Contributor/[a]list daily senior editor

Steve Peterson has been in the game business for 30 years now as a designer (co-designer of the Champions RPG among others), a marketer (for various software companies) and a lecturer. Follow him on Twitter @20thLevel.