Friday, March 5, 2010

Call of Duty Leads to Legal Warfare

ActivisonActivision Blizzard Inc. has been sued by the very executives they fired last Monday. Jason West and Vince Zampella, the former heads of Call of Duty: Modern Warfare development at Infinity Ward, have filed a lawsuit against their publisher alleging that the company has used wrongful insubordination charges to fire them and for a breach of contract.

The complaint, which was filed in Los Angeles County Superior Court on Wednesday, states that Santa Monica-based Activision has fired the pair in order to avoid paying them royalties for their military shooter Modern Warfare 2, which has accumulated more than $1 billion in retail sales since release. They seek at least $36 million, control over “Modern Warfare”, the most successful subset of the “Call of Duty” franchise to date, and an agreement that Activision may not release any Call of Duty games set after the Vietnam War without their approval.

"Activision has refused to honor the terms of its agreements with Mssrs. West and Zampella and is intentionally flouting the public policy of this State that employers must pay their employees what they have rightfully earned," the complaint states. "Instead, Activision has adopted the corporate strategy of forcing Mssrs. West and Zampella to sue for their pay -- in the hopes of either getting away with not having to pay them anything or maximizing its leverage to reduce that pay."

The pair believe that Activision has conducted an unorthodox investigation which began in early February and concluded last Monday in a report from Activision which states that the company was "concluding an internal human resources inquiry into breaches of contract and insubordination by two senior employees at Infinity Ward."

“Activision terminated their employment weeks before they were to be paid substantial royalty payments as part of their existing contracts for ‘Modern Warfare 2,’” West and Zampella’s lawyers at O’Melveny & Myers LLP wrote in a statement.

Activision has released the following response to the lawsuit.

Activision is disappointed that Mr. Zampella and Mr. West have chosen to file a lawsuit, and believes their claims are meritless. Over eight years, Activision shareholders provided these executives with the capital they needed to start Infinity Ward, as well as the financial support, resources and creative independence that helped them flourish and achieve enormous professional success and personal wealth.

In return, Activision legitimately expected them to honor their obligations to Activision, just like any other executives who hold positions of trust in the company. While the company showed enormous patience, it firmly believes that its decision was justified based on their course of conduct and actions. Activision remains committed to the Call of Duty franchise, which it owns, and will continue to produce exciting and innovative games for its millions of fans.

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