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Stargate Games Lawsuit

Former shareholders in Cheyenne Mountain Entertainment have filed a conspiracy complaint against Dark Comet Games, Fresh Start Studios, and five individuals: Karl Hiatt and his wife (first name unknown), Mark Renberg, Chris Lombardo, and Harlan James Brown II, according to Courthouse News Service. The legal action is over Cheyenne Mountain Entertainment's bankruptcy, and claims that the transfer of assets from Stargate Resistance and Stargate Worlds was done without the approval of the bankruptcy court. The plaintiffs say "Fresh Start Studios allegedly paid $100,000 to purchase all of Cheyenne Mountain's assets, a fraction of 1 percent of the assets' worth," and that CME "raised and expended tens of millions of dollars in connection with the development of Stargate Resistance and Stargate Worlds." Word is: "Plaintiffs seek a declaration that the transfer of assets to Fresh Start is fraudulent, and want the assets returned Cheyenne Mountain Games. They also want $10 million in damages, alleging breach of contract, civil conspiracy, fraudulent transfer, tortious interference and unjust enrichment."

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19. Re: Stargate Games Lawsuit Aug 28, 2010, 14:39 Delwin
 
Makes me glad I left QOL when I did...

 
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18. Re: Stargate Games Lawsuit Aug 27, 2010, 11:09  dsmart 
 
Veterator wrote on Aug 26, 2010, 23:40:
If this company sold assets for 100k and that was less than 1% of it's value....they are trying to say that the original company was worth more than 100x that. So the company that filed for bankruptcy was worth over 100 million dollars.

And they only want 10 million dollars in damages for being scammed out of 99.9M dollars?

I agree they should never be able to sell assets to themselves without scrutiny, but something here doesn't sound right in either instance.

If that company was worth over 100mil, why was it going bankrupt? Sounds like horrible speculation to me. If you had that much realistically in assets, you could afford to sell off some of it to keep the company floating to cash in on the works in progress. If it's "theoretical maybe coulda made after all this extra work" then it's worth whatever someone will pay. If someone else would pay more than 100k for it and they never took the time to shop around, then I see a reason for the lawsuit in that.

100m in property for 100k should have been an immediate action from the courts to freeze accounts and transactions until it was straightened out. The fact that it took place and no one really noticed until afterwards says that the 100m claim is complete bullshit.


I absolutely agree. Which is the same bullshit we faced with that alleged fraudster and embezzler David Allen who I fired from QOL this past March. He then turned around and sued the investors, despite the fact that he had not only blown through their money with impunity, but also blatantly (according to court docs) embezzled a good portion of it for his own personal gain. So they sued him right back and now it is in the final stage of settlement talks, though I'd have very much like to have seen him go to jail. Oh well.

imo, the sooner these investors start suing all these a$$hats, the better it will be for them to just go off and do the same damn thing all over again.
 
Avatar 9141
 
Game developers are just human beings who happen to make games for a living. If you want to hold us up to higher standards of conduct, then go ahead
...but don't be surprised if we don't uphold them
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17. Re: Stargate Games Lawsuit Aug 27, 2010, 08:05 Bill Borre
 
Oh c'mon. Our entire society is predicated on unjust enrichment.  
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16. Re: Stargate Games Lawsuit Aug 27, 2010, 04:13 Veterator
 
Yeah I see what I did, got to thinking millions and screwed up my argument. But the point still stands, it's not as pronounced but if the assets were really worth the 10+ million they claim... assuming the transaction was handled solely by the conspiring parties which is hard to imagine and then went through with no one noticing it. I would think the court would freeze them.

10 million in damages is now only fair if they can prove that the assets are worth what they claim. And they can only prove that if they can find someone who would pay that for them.

However now I can see why they went bankrupt if they "raised and expended tens of millions of dollars in connection with the development of Stargate Resistance and Stargate Worlds."

But yep, I screwed up on the numbers and still may have screwed up on them given that Im tired. Values still seem awfully blatant fraud, so much so that it seems like there's a bit of seller's/investors remorse going on with hopes that the courts will help them increase the payout purse. I mean maybe they did do it, or maybe they were the only ones willing to pay at least 100k for it at the time. Still seems like there's plenty of bullshit in the little info released.

I'll refrain from math in the future.
 
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15. Re: Stargate Games Lawsuit Aug 27, 2010, 01:00 Cutter
 
Woo someone is getting F'd in the A!
 
Avatar 25394
 
"The South will boogie again!" - Disco Stu
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14. Re: Stargate Games Lawsuit Aug 27, 2010, 00:08 Sepharo
 
Veterator wrote on Aug 26, 2010, 23:40:
If this company sold assets for 100k and that was less than 1% of it's value....they are trying to say that the original company was worth more than 100x that. So the company that filed for bankruptcy was worth over 100 million dollars.

And they only want 10 million dollars in damages for being scammed out of 99.9M dollars?

I agree they should never be able to sell assets to themselves without scrutiny, but something here doesn't sound right in either instance.

If that company was worth over 100mil, why was it going bankrupt? Sounds like horrible speculation to me. If you had that much realistically in assets, you could afford to sell off some of it to keep the company floating to cash in on the works in progress. If it's "theoretical maybe coulda made after all this extra work" then it's worth whatever someone will pay. If someone else would pay more than 100k for it and they never took the time to shop around, then I see a reason for the lawsuit in that.

100m in property for 100k should have been an immediate action from the courts to freeze accounts and transactions until it was straightened out. The fact that it took place and no one really noticed until afterwards says that the 100m claim is complete bullshit.

Math how does it work?
 
Avatar 17249
 
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13. Re: Stargate Games Lawsuit Aug 26, 2010, 23:40 Veterator
 
If this company sold assets for 100k and that was less than 1% of it's value....they are trying to say that the original company was worth more than 100x that. So the company that filed for bankruptcy was worth over 100 million dollars.

And they only want 10 million dollars in damages for being scammed out of 99.9M dollars?

I agree they should never be able to sell assets to themselves without scrutiny, but something here doesn't sound right in either instance.

If that company was worth over 100mil, why was it going bankrupt? Sounds like horrible speculation to me. If you had that much realistically in assets, you could afford to sell off some of it to keep the company floating to cash in on the works in progress. If it's "theoretical maybe coulda made after all this extra work" then it's worth whatever someone will pay. If someone else would pay more than 100k for it and they never took the time to shop around, then I see a reason for the lawsuit in that.

100m in property for 100k should have been an immediate action from the courts to freeze accounts and transactions until it was straightened out. The fact that it took place and no one really noticed until afterwards says that the 100m claim is complete bullshit.

 
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12. Re: Stargate Games Lawsuit Aug 26, 2010, 22:10 Sepharo
 
Don't worry narf.

With hellbinder it always ends up "What is the world coming to?"

"1 + 2 = 3 ... Kids these days!"

This comment was edited on Aug 26, 2010, 22:15.
 
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11. Re: Stargate Games Lawsuit Aug 26, 2010, 20:18 Narf2029
 
The guy coding at his desk is probably trying to pay the bills, yes. The investor that fronted him and his friends a shitload of money wants a lot more than the bills paid, whether that is a reasonable expectation or not. I fail to see how my pointing this out means I have an unrealistic sense of entitlement. If anything, I am speaking against that sense of entitlement often found in investors today.  
Huh? I'm sorry, I was thinking about cake.
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10. Re: Stargate Games Lawsuit Aug 26, 2010, 20:01 Burrito of Peace
 
Whenever you turn something in to a commodity, you'll always see people trying to produce or buy that commodity at rock bottom prices and sell it somewhere else for a profit. Whether that is by legitimate means or not, it always happens.  
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9. Re: Stargate Games Lawsuit Aug 26, 2010, 19:37 Sty
 
Starting to see a pattern here. File for bankruptcy, ditch the company and then reacquire the IP for far less under a new startup.  
Avatar 13874
 
You know selling dlc before you patch the client doesn't impress upon me the need to support your shit. -massdev
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8. Re: Stargate Games Lawsuit Aug 26, 2010, 17:55 PHJF
 
our society is sick with a self inflicted cancer.

I agree. Poor grammar is just everywhere these days.
 
Avatar 17251
 
Steam + PSN: PHJF
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7. Re: Stargate Games Lawsuit Aug 26, 2010, 17:20 nin
 
our society is sick with a self inflicted cancer.


I think that every time you post, yes.


Down, Not Across, Dude.
 
http://www.nin.com/pub/tension/
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6. Re: Stargate Games Lawsuit Aug 26, 2010, 17:09 Hellbinder
 
so.. narf2029 a game is not profitable or worth making if it cant be equal to or beat wow? (i see you edited your comment)

This kind of thinking is utterly LAME.

When you make a game you are not trying to make a game that makes 150 million a month. You are trying to make a game that pays the bills, covers its cost and hopefully generates some profit. If your game ends up making you a billionare great. You dont start out with the attitude "if this game doest make me a bilion dollars its worthless and a waste of time".

I mena seriously man what has casued you to think this way? Its like most of the teens these days they want a vice president position right out of school and 100k a year or why bother ill just live with my mom and play xbox.

our society is sick with a self inflicted cancer.
 
The Whales name is Bob.
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5. Re: Stargate Games Lawsuit Aug 26, 2010, 16:30 Kxmode
 
DG wrote on Aug 26, 2010, 15:49:
The complaint isn't about the investors losing their money on a bad investment, it's about their money being stolen through fraud.

1. Use investor's money to make a valuable asset for company A
2. Sell asset for small change to company B you own personally
3. Liquidate the original company A
4. Profit

"I feel their pain when they get bamboozled out of their millions." http://en.wikipedia.org/wiki/Bamboozling
 
Avatar 18786
 
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4. Re: Stargate Games Lawsuit Aug 26, 2010, 15:49 DG
 
The complaint isn't about the investors losing their money on a bad investment, it's about their money being stolen through fraud.

1. Use investor's money to make a valuable asset for company A
2. Sell asset for small change to company B you own personally
3. Liquidate the original company A
4. Profit

This is a common fraud. It's not a very difficult idea for people with weak ethical values to come up with, it's quite difficult to prove and even even if you do and get your asset back, it's even harder to successfully prosecute the fraudster.
 
Avatar 14793
 
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3. Re: Stargate Games Lawsuit Aug 26, 2010, 15:06 D_K_night
 
Even take a look at the MMO's who "aren't trying to compete with WoW", and see where they are today. Nowhere near raking in the profits that investors want to be seeing.

There are very few that still survive(EVE is a good one), but AoC, Warhammer...all going downhill.
 
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2. Re: Stargate Games Lawsuit Aug 26, 2010, 14:59 Narf2029
 
I don't really feel their pain. Anyone with half a neuron knows the only thing that has any chance of knocking WoW out of the top spot is something else made by Blizzard, and anyone willing to gamble millions to the contrary... well, a fool and his money are soon parted. You don't have to have the expectation of beating WoW to make an MMO, but to make the money printing machine these investors often/always expect, you would have to.  
Huh? I'm sorry, I was thinking about cake.
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1. Re: Stargate Games Lawsuit Aug 26, 2010, 14:32 Kxmode
 
I am really starting to feel sorry for these investors. Anyone can say "They should have done their homework!" and I agree with that, but it is also hard to determine who is qualified and competent enough to create and deliver a MMO on or under budget. Then there's the question of whether a MMO will even be successful. I'm sure investors had plenty of doubts Blizzard could pull of World of Warcraft considering they never made a MMO before. Investors put a lot of faith in these developers, and I feel their pain when they get bamboozled out of their millions.

I fully expect Derek Smart to say something here.

This comment was edited on Aug 26, 2010, 15:09.
 
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