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Activision sued for up to $125 million by current, former Infinity Ward employees [updated]

MW2a Activision's Call of Duty-related headaches just leveled up.

More than three dozen former and current employees of Infinity Ward, the Encino-based development studio that made the hugely successful Call of Duty: Modern Warfare video games for Activision Blizzard Inc., have sued the publisher claiming that they are owed between $75 million and $125 million in unpaid royalties and potentially more in compensatory damages.

The move by the 38 current and former staffers comes a little over a month after former Infinity Ward heads Jason West and Vince Zampella were fired by Activision and filed their own $36-million lawsuit against the Santa Monica-based publisher over allegedly unpaid royalties.

Two weeks ago, West and Zampella formed a new development studio called Respawn Entertainment and signed a deal with Activision's chief rival, Electronic Arts, Inc.

Since West and Zampella left Infinity Ward, a number of other employees have left the studio, some of whom have joined Respawn. Of the 38 employees involved in the lawsuit, 21 are former employees of Infinity Ward;  17 still work there. Approximately 95 people worked at Infinity Ward on last November's Modern Warfare 2, meaning that about 40% of its employees at that time are now suing Activision.

The ongoing dispute puts the future of the Call of Duty franchise, one of the pillars of Activision's success, in doubt. Modern Warfare 2 was the most successful video game of 2009 in the U.S. It sold about 20 million units around the world and generated an estimated $1.3 billion in revenue.

The lawsuit says that Activision owes Infinity Ward employees a bonus pool of at least $118 million, of which $82 million is supposed to go to employees other than West and Zampella.

It alleges that the publisher has withheld royalty payments in order to keep them from leaving as their former bosses did, putting at risk the potentially hugely lucrative release of Call of Duty: Modern Warfare 3 planned for late 2011.

"Activision engaged in this inappropriate course of conduct in an attempt to force employees of Infinity Ward to continue to work at a job that many of them did not want just so Activision could force them to complete the development, production and delivery of Modern Warfare 3," the suit says.

It goes on to allege that Activision representatives told Infinity Ward employees that if West and Zampella had not been fired, the employees would have received bonuses approximately 2.5 times higher than what they were paid on March 26.

"Activision believes the action is without merit," a company spokesman said in response to the suit. "Activision retains the discretion to determine the amount and the schedule of bonus payments for [Modern Warfare 2] and has acted consistent with its rights and the law at all times. We look forward to getting judicial confirmation that our position is right." [Updated at 2:35 p.m. with Activision response.]

The complaint filed Tuesday in Los Angeles Superior Court in Santa Monica is based in part on the same allegations contained in West and Zampella's suit. The plaintiffs' attorney has asked that the two cases be consolidated.

-- Ben Fritz

Photo: A scene from Call of Duty: Modern Warfare 2. Credit: Activision

 
Comments () | Archives (15)

And in the mean time the paying customer is getting hit too. We have so many issues with this game that has been left unfixed and I believe the last update was tampered with because they knew this was happening.
Thanks Activision and Infinity Ward! Thanks for a waste of $74.00 Game and Map Pack!
I can't use either and the same goes for thousands more like me.

As a former employee, all I can say is that hopefully Activision will get theirs.

It couldn't happen to a nicer company

I liked COD but it was buggy and it was easy to cheat. So now my friends and I are playing Halo 3 again. Hope the next one is better.

I have so much hatred for large publishers like Activision, EA and Ubisoft who are now going into full nickle and diming mode to get money from their customers. Developers want to make great games, but they always suffer because of the publishers have them by the gonads. I hope Activision gets a swift kick in theirs.

Call of Duty is a dead franchise. I know PC gamers that are already going to Boycott MW3 because of the crap that IWnet forced upon us.

Activision has always been on my $hi# list. They seem to forget who put them were they are today, the developers and the customers who buy the games. Without either there would be no Activision. I support the Developers and plan not to buy games from Activision until they start playing fair with the Developers. The $59.00 price for CODMW2 was outrageous to me. Games seem to be costing more but don't offer as much in the way of single user playablility. I am not a big fan of multiuser online play. So I have purchased less and less games as a result of this. But now I find that Activision is withholding royalties from the very people that makes the games that I play. Well that is not acceptable and I will not give my hard earned money to Activision until they stop acting like the greedy A$$#ole$ that casued the financial meltdown in on WallStreet. Stepping on the little guy is not okay with me. So here's to the great folks at Infinity Ward, may your suit with Activision be successful.

While it sure sounds like activision is giving the infinity ward staff the shaft there are always two sides to a story. I wonder how much the staff are getting paid to make the game and how much of a royalty/bonus they received already.

So 82 Million is supposed to go to the 38 employees other than the two heads. That's over 2 million dollars per employee. With bonus's like that it's no wonder video games cost so much. Pass some saving onto your customers and I might start having a bit of sympathy over your plight.

Erik:

"Approximately 95 people worked at Infinity Ward on last November's Modern Warfare 2, meaning that about 40% of its employees at that time are now suing Activision."

There's 38 suing, but the bonus goes to all of the employees.

The only way i will even consider getting Modernwarfare 3 is if i can trade my current Broken Call of Duty 4 Modded Combat 2 (For those who dont get the joke im talking about Modern Warfare 2)

They gotta be kidding me!!!!! Even charging the community for map pack with 5 maps in it, and 2 of them are from they old Call of duty 4! At this point and time in done with the series unless i can get some reperations!!!

Infinity Ward was ruined by Activision. They didn't even want to make MW2. They wanted to make a different game, but Activision basically forced them to make MW2 and that is why MW2 was a let down. IW was uninspired. Best of luck to the former IW employees in the future.

It sickens me how people say 'O I feel bad for them, o wait.... They make at least $1 more than I do??? SCREW THEM!'

You people have no idea what is like to be a developer. You work 10 hour days at bare minimum, usually 6 days a week are mandatory, when its crunch time (last few months before a release) you can expect to work 14 hour days, 7 days a week. On top of that, you make relatively little compared to other IT careers. It is an insane amount of time and effort. The reason it is done, is because of the promise of bonus's when a product is released on time and with as few bugs as possible.

So yeah, these roughly 100 employees destroyed their home lives, social lives, and likely their own health, to make sure they got a decent bonus... and Activision is screwing them in the end. Whats worse is, the 'average joe' says 'O they already got payed more than I so Tough luck...

When you work the hours that these developers put in, at their pay rate.. THEN you can say 'tough luck'.

Well it was bound to happen..yes! IW set the bar high for the best Fps ever and they know that now and it's becoming a cash cow for them and the people who work there are not seeing the money..that's like if you were working for a car dealership and you sold all the cars and now waiting for the profits you earned and then was told to sell another years full of cars then you'll get paid..well fu@k that! look at the quality of the game and the glitches,leaderboard hacks,10th perstige lobbys,no demo and the list of cheatin goes on and on..

"We look forward to getting judicial confirmation that our position is right."

Well you won't get it, you greedy pieces of human scum. HOW is cheating people out of their money "right"?

I will never buy another Activision game again, and neither will any of my friends.

Most of the orginal crew that built World of Warcraft left due to being "Overworked - Underpaid". They are now at Carbine Studios and are very happy I'm told.

Good luck Infiniti Ward folks! It's your turn now! Can't wait to see what you guys dream up next! Please don't stop doing what you do best. Build kickass first person shooters.


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