38 Studios CFO Testifies in Bankruptcy Court

July 13, 2012 -

The Providence Journal has several stories related to the ongoing saga of 38 Studios. The first story details the testimony of Richard Wester, chief financial officer for 38 Studios in bankruptcy court this week in Delaware.

Wester told the court that the company anticipated selling 2 million units of its action-RPG Kingdoms of Amalur: Reckoning, but ultimately only sold about 1.3 - 1.4 million units on multiple platforms. Wester claims that if they had hit that milestone, the company would have been able to pay its ongoing expenses and finish work on its MMO Copernicus. He claims that the game would have generated $100 million annually for the company. With that money coming in, 38 Studios could have begun paying down the $75 million in debt it owed to the state of Rhode Island.

Wester went on to say that the revenue split for the RPG was 70/30, with EA taking the lion's share of the money from sales. From its share of the sales, 38 Studios had to pay Electronic Arts back nearly $30 million it received in advances while developing the game.

In another Providence Journal story, the lawyer chosen as the trustee to oversee the company's bankruptcy case asked the court for permission to hire additional lawyers. Wilmington lawyer Jeoffrey Burtch asked the judge for permission to hire the law firm Cozen O'Connor, to help him sort out what the intellectual property owned by 38 Studios is worth. Cozen O'Connor specializes in intellectual property law.

Finally, EA Labels president Frank Gibeau told Game Informer magazine in a recent interview that his company would love to publish a sequel to The Kingdoms of Amalur, but acknowledged that the IP for the game will probably end up being owned by the state of Rhode Island or sold off to some other entity as part of the company's bankruptcy. Gibeau described the whole situation as unfortunate for 38 Studios.

"I think it's unfortunate how everything worked out [for 38 Studios]," said Gibeau. "At the end of the day we saw a lot of creativity and vision in the team that Curt [Schilling] put together. We thought the game was terrific. It reviewed well."


Comments

Re: 38 Studios CFO Testifies in Bankruptcy Court

Aw too bad.  KOA was a solid, fun title with some decent potential. 

 
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