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Harmonix Founders Suing Viacom

sjohnson
5 Comments

Posted December 21, 2010 - By Stephen Johnson

Rock Band 2

The fallout from Viacom's decision to sell Rock Band developer Harmonix has begun falling out. Former shareholders, including  Harmonix founders such as Alex Rigopulos and Eran Egozy, filed a U.S. lawsuit against Viacom, alleging the media company is not paying out bonuses owed.

The lawsuit says that the suit was filed to "recover damages arising from Viacom's manipulation of ... earn-out payments by diverting opportunities from Harmonix for its own benefit in breach of the implied covenant of good faith and fair dealing that inheres in Viacom’s contract with Harmonix."

The issue dates back to the original acquisition of Harmonix back in 2006. According to the suit, the terms of the buyout included bonuses to be paid on future profits from the Rock Band franchise. As sometimes happens in these cases, the two parties seem to have very different ideas of exactly how much money should be paid out to shareholders. The suit contends that Viacom tried to find ways to pay less to shareholders, including "a mid-earnout negotiation of the distribution agreement with Electronic Arts' EA Partners division." 

According to the suit, Viacom "decided to forego the opportunity to reduce EA’s distribution fees during 2008 (or in any other way enhance Harmonix’s net income or Gross Profit for 2008), and instead demanded benefits for itself (rather than Harmonix) in exchange for allowing EA to continue distributing Rock Band."

Source: Gamasutra

Harmonix Founders Suing Viacom
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Comments are Closed

  • Wozman23

    This is pretty sad. Rock Band has always been a critical darling, and many including myself see Rock Band 3 as the greatest music game thus far, and about as close to perfect as a game can get. As a guy who's purchased multiple bundles and hundreds upon hundreds of downloadable tracks, I wish HMX the best.

    Posted: December 22, 2010 9:39 AM
    Wozman23
  • kings_legacy

    No surprise, music games are pretty much dead now. I played when Guitar hero 2 came out for 2 months and got though the fad as it became just listing to different songs and pressing different buttons to me.

    So it is inevitable when it starts for the fan that people go to lawsuits or try things that aren't legal to cut losses.

    R.I.P Guitar Hero and Rock Band, it was fun while it lasted

    Posted: December 21, 2010 9:46 PM
    kings_legacy
  • AshVSdarkness

    I just hope that someone other than Activision buys them. Otherwise I fear they would take that opportunity to bury their only competition in the music game genre. On the other hand, they might surprise us, but I doubt it. And I agree you MMORPGAL about hopefully seeing another RB game and playing the songs I already own. I thinks I've spent more on DLC thatn for the first RB w/instruments and RB 3 w/keyboard combined (I have about 450-500 songs myself)

    Posted: December 21, 2010 4:19 PM
    AshVSdarkness
  • Infinityman

    Please take this time to go buy Rock Band 3 people. It is easily the best music game out, and Harmonix should be proud of it, even if people aren't buying. Shame on Viacom, and the whole "falling knife" issue.

    Posted: December 21, 2010 2:29 PM
    Infinityman
  • MMORPGAL

    I am curious to see how this whole things turns out. With the coming sale of Harmonix to another company and this Lawsuit that has recently been filed I found myslef as a frequent buyer of Harmonix songs (I've downloaded over 800 songs) I find myself uncertain of what will happen to the game I so love. In many ways Rock Band really isn't even a game anymore but more of a platform. It's a way for people to embrace music in a fun and interactive way and the thought of no longer being able to play new songs (or even worse no longer being able to play the songs I've already bought, particularly if they plan to bring Rock band to the next iteration of platforms) is one that absolutely terrifies me. With that said I am confident that regardless of what the future of Harmonix holds I am confident they can continue to make Stellar games...I just wish those stellar games had more appeal.

    Posted: December 21, 2010 1:01 PM

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