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On September 8, 2009 Bethesda Softworks LLC filed a Complaint for Declaratory Judgement, Preliminary Injunction and Other Relief against Interplay Entertainment Corp. in the United States District Court for the District of Maryland. On October 16, 2009, Interplay Entertainment Corp. ("Interplay") answered the lawsuit and asserted Counter-Claims against Bethesda, including for Breach of Contract, Declaratory Judgment, and other relief.
Bethesda seeks to cancel the April 4, 2007 trademark license agreement that conditionally allows Interplay to use the FALLOUT (R) brand in conjunction with its currently-in-production massively multiplayer online game. Bethesda claims that Interplay failed to commence full scale development and to satisfy a funding requirement within a specied time frame. Bethesda also seeks to terminate Interplay's rights with respect to the previously released FALLOUT (R), FALLOUT (R) 2, and FALLOUT(R) Tactics games. Interplay disputes these claims. Although the potential damages are currently unknown, if Bethesda ultimately prevails and cancels the trademark license agreement, Interplay could lose its license to use the FALLOUT(R) brand with respect to its massively multiplayer online game and/or its license to distribute the back catalog FALLOUT(R) titles and may owe monetary damages.
Interplay's counter-suit alleges that Bethesda interfered with Interplay's business, including distribution of the previously released FALLOUT (R), FALLOUT(R) 2, and FALLOUT(R) Tactics games, by attempting to terminate Interplay's distribution rights, among other acts. Interplay asks the Court to decide whether Bethesda's attempt to terminate Interplay's rights under the Asset Purchase Agreement results in nullification of the entire contract such that the Parties should be returned to the status quo under their former Exclusive Licensing Agreement. If the Exclusive Licensing Agreement is restored, Bethesda may owe royalties based upon sales of its FALLOUT (R) 3 title. Interplay also seeks a declaration from the Court that it has not infringed upon the FALLOUT(R) mark and that it has satisfied the terms of the Trademark Licensing Agreement related to Interplay's production of a massively-multiplayer online game. A hearing on Bethesda's Motion for Preliminary Injunction is currently set for December 11, 2009.”
It also includes information of Interplay's current financial situation:
As of September 30, 2009, we had a working capital deficit of approximately $2,477,000, and our cash balance was approximately $49,000.”
We are exploiting, or planning to exploit, our portfolio of gaming properties through sequels and various development and publishing arrangements in the following ways:
- Sequels for video game consoles and personal computers
- Downloadable existing and new content for video game consoles
- Electronic distribution of existing content for personal computers
- Electronic distribution of new content for mobile devices
We have entered into a Game Production Agreement with Interactive Game Group which provides for the financing of the development of games under certain conditions.
We continue to seek external sources of funding, including but not limited to, incurring debt, the selling of assets or securities, licensing of certain product rights in selected territories, selected distribution agreements, and/or other strategic transactions sufficient to provide short-term funding, and achieve our long-term strategic objectives.
If we do not receive sufficient financing or income we may (i) liquidate assets, (ii) sell the company (iii) seek protection from our creditors including the filing of voluntary bankruptcy or being the subject of involuntary bankruptcy, and/or (iv) continue operations, but incur material harm to our business, operations or financial conditions. These conditions, combined with our historical operating losses and our deficits in stockholders' equity and working capital, raise substantial doubt about our ability to continue as a going concern.
Our primary capital needs have historically been working capital requirements necessary to fund our operations. Our operating activities generated cash of $73,000 during the nine months ended September 30, 2009.”
Personally, I hope that Herve Caen finally sells the company to someone actually competent. Maybe Brian Fargo will buy it back, for personal satisfaction and for Interplay's better brand recognition than inXile's? After all, he said that he always considered Interplay to be his creation, and considered himself to be temporarily "in exile".