WA Dev Interzone Games Close To Liquidation

We received a desperate plea last night from a former staffer at WA developer Interzone Games. Seems the developer is just days from liquidation, with a major outstanding tax debt and unpaid wages to current and former staff. What's even worse is the US parent company could be breaking a wealth of laws to leave local staff high and dry. UPDATE: Interzone CEO Marty Brickey has responded.

UPDATE: Interzone CEO Marty Brickey has responded to the statements made below. Read his perspectives on the collapse of Interzone Games here.

Right now Interzone owes $1 million to the ATO, and another $500,000 to past and present staff, including unpaid super. The company seems to be breaking a number of corporate rules, like having no resident director in Australia since August, nor paying super for two years. And now as the company is set to be liquidated by the ATO, the US parents are trying to pack up server hardware and game code to date to whisk them all away overseas to keep their current game development going while abandoning the local operations. They're even setting up a new development house in Ireland, Big Collision, to follow through on a European distribution deal for the MMO sports game -- Interzone Futebol -- which sounds quite cool and is supposedly aiming to launch around the timing of this year's World Cup.

So that's $1.5m owed to local staff. Taking assets out of country when liquidation is imminent. Handing assets to another off-shore company while hanging local company out to dry.

It sounds like a pretty massive disaster and a seriously dodgy incident, and it's going down this week. If you happen to work for someone with the authority to bust these guys in the act of ripping IP out of an Australian company and taking it away without appropriate authority to do so, let us know and we'll get you in touch with these guys.

We think it's best to let Tim Colwill, former World Designer for Interzone Games, tell the story in more detail.

We are also following up on this in earnest to see what is being done in the industry to help Interzone Games wrap up in as fair and legal a manner as possible.

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There are two legal entities in this saga: the Perth Studio in Western Australia, and the Interzone US corporate arm (Interzone Entertainment), incorporated in Missouri, USA.

Three key players have been spearheading all the actions of the US corporate arm, and consistently failing to meet all promises of compensation and entitlements to the Interzone employees across the globe. These people are Mike Turner, Greg Chadwell, and the Interzone CEO Marty Brickey.

Here's a short history of how Interzone got to this point.

  • The financial troubles of Interzone as a global company began during the infamous credit crunch in late 2008. The US corporate arm continually missed payments to all the international studios (Perth, China, and Brazil) and staff fell weeks behind on pay.
  • The Perth studio, as the lead development studio, was deemed the most important studio to keep alive on the limited funds available, and so the China and Brazil studios received less and less money until eventually their creditors forced them into liquidation, putting around 50 people out of work. These people are still owed substantial amounts of unpaid entitlements, and Mike, Greg and Marty have refused to communicate with them.
  • Despite this drastic action, the US corporate arm could still not find the funds to pay the Perth studio consistently. Much unpaid work was requested of the Perth studio in order to demonstrate the game to potential publishers and continue development. Many key staff left to pursue other (paying) work. From what was once a studio of over 40 full time employees, only 15 remain.
  • Thanks largely to the months of unpaid work by dedicated Perth Studio employees, Interzone managed to finally signed a deal in late August 2009 with a European publisher to deliver the Interzone Futebol game.
  • Interzone are critically behind on the deliverables for this publishing deal, which is perhaps unsurprising as the development studio in Perth aren't working on it, because they aren't getting paid.
  • Since January 2008, Interzone has not paid any superannuation to its staff, which is illegal under Australian law.
  • Since August 2008, Interzone has been trading without a resident director, which is illegal under Australian law (the director stepped down because he wasn't getting paid, either).
  • Last week Greg Chadwell and Mike Turner, who were holding Director positions at the Perth studio, resigned from their positions quietly. In their place Marty Brickey has been installed as resident director - a complete farce as he hasn't set foot on Australian soil in almost two years and has no intentions of doing so, given the company is facing liquidation. ASIC, the government body responsible for this sort of thing, clearly aren't checking their facts.

Interzone's Perth Studio has debts to the Australian Taxation Office totaling over $1 million AUD. Marty Brickey has confirmed that he has no intention of paying those debts with any of the current funding that has been secured. [A big accusation and we have no confirmation ourselves that Brickey would have 'confirmed' such a course of action, and would almost certainly deny this publically -- but this is the belief of Tim Colwill] . As a result of this, the Perth studio can be issued with a closure notice from the ATO as soon as this coming Monday February 15. Happy Valentine's Day.

Interzone has debts to its employees, ex- and present, in salary, entitlements and superannuation, totaling over $500,000 AUD.

And all that aside, here's where it gets interesting.

Marty, Greg and Mike have used the Interzone Futebol product, as developed by the Perth Studio through unpaid labour, to secure additional funding that is believed to be in the millions. They have used this money to set up a studio in Ireland called Big Collision Games (http://www.bigcollisiongames.com/). Their website purports to be publishing the "Futebol" game through this European publisher.

During dealings with the publisher and other partners, Marty, Greg and Mike continually blamed the Perth studio for these missed deliverables, even though the Perth studio had been working without pay for weeks!

Yesterday (Monday the 8th) at a meeting, the Perth staff learned the following:

  • Marty Brickey, CEO and company director, issued an order that all Perth staff are to be immediately suspended without pay.
  • Certain "key staff" have been approached to sign individual contracts to undertake work that will facilitate Mike Turner (who is, at this time, not employed by Interzone in any legal capacity) moving the servers and all IP away from Perth to the USA, and to continue development on the title.
  • If these key staff agree to these individual contracts, Marty has promised that they will pay out the outstanding pay owed to all current Perth employees. Yes, you read the right: if certain staff agree to do extra work, they will pay out the money they already owe.
  • Mike Turner is flying out from the US to Perth mid this week - if he's not already here - and he will immediately begin to back up, and pack up, the servers and files necessary to run the game at its current state, in the USA. Mike Turner is no longer a director of the Perth studio or one of its employees. It is almost certain he will not be in Australia on a business visa. It is almost certain that he has no legal right to perform this action, or to even be on the premises, under Australian law.
  • A company is being contracted to "finish" the IP and bring it to closed beta for the publisher.
  • Marty then promised that if they are able to do all these things, once they have successfully delivered the game to the publisher and it has been published, then, and only then will they consider paying out all the outstanding entitlements to all Interzone employees, past and present.

WHAT FOLLOWS IS SUBJECTIVE OPINION AND NOT FACT

Needless to say, this announcement caused complete and total outrage in the Perth studio. These are people who have been consistently lied to, deceived, and let down by Marty, Greg and Mike. These are people who have stayed true to the company through over a year of inconsistent funding, non-existent technical support, and long unpaid working hours. Many of these are people for whom this was their first job in the games industry, the job that would make or break their career! The dedication, talent, and loyalty of these people have been criminally abused.

And now, after all this, they are being told that they are not good enough, that the game they have put their sweat and blood and tears into over the last three years is going to be taken away from them, and is going to be "finished" by an American company that they have never heard of.

And even worse, this new company is being paid with money that could be used to pay them. If you'll forgive the all-caps, THIS IS INSANE!

Ex-employees like myself have received personal assurances that our debts would be taken care of. I received a personal phone call from Mike Turner on Thanksgiving Day telling me everything would be okay. Now the company is going to be shut down and liquidated by the Australian Taxation Office, and he doesn't care, and I will never see the money that I am owed - nor will anyone else. I was flat-out lied to, messed around, and never received any sort of apology.

And I'm nowhere near the worst-off - one friend of mine is owed nearly $20,000 AUD by Interzone and is currently suing for unfair dismissal after he was sacked for encouraging other employees to speak out about the situation and to pursue official avenues for compensation. How much do you think he will receive from Interzone? I'll give you a hint: it starts with "z" and ends with "ero".

As an unfortunate side effect of this, it is almost certain that the games industry in Perth will be irreparably damaged. The Western Australian government sunk $500,000 into Interzone to get it started, and with the studio now being liquidated, it is a huge disincentive for them to provide any further support to any other companies that might wish to base their operations here.

There are many serious questions that need to be asked of these three mismanaging charlatans, these three amigos of deception, Marty, Greg, and Mike.

  • How did they let this go on for so long?
  • Why have they continued to operate illegally, and trade insolvently?
  • Why aren't they using the money that they do have to pay out the debts they have accumulated?
  • When will the ex-employees in Perth, China and Brazil ever see the money they are owed?
  • Why should anybody trust them, after so many promises of payment and reparation have been broken?

I hope that this information has been helpful to you and that you can take steps to bring it to the public attention. Marty Brickey, Mike Turner, and Greg Chadwell cannot be trusted or counted on.

Anybody applying for work at Big Collision Games in Ireland needs to know this. Anybody that is contracted by them needs to know this. Anybody entering into any future publishing deals with them needs to know this!

WATCH MORE: Gaming News


Comments

    One of the best articles I've read on here. Spread the word - although, I have little sympathy for the employees that stayed even when they knew they were in financial trouble.

      It seems that should be the case, but I really can't stress enough to people here saying things like that, that you have to understand the mindset that leads to people staying around.

      First of all - Interzone was an EXCELLENT team and group of people. I know that the majority of IZ staff will agree that it was just about a dream job, and dream place to work - with people that made you actually want to come into work the next day.

      Secondly - Most people had VERY strong buy in to the product. Management did encourage this at an early stage, but by the end it was because everyone CARED about the game. Management knew this and eventually ACTIVELY exploited it.

      Finally - A lot of the staff were young, or had few to no "Shipped titles" on their CV. The fact is the product got so close to being shipped that most people were willing to believe Management's bullshit because they knew that if money came through, they could get it over the line and be proud of not just a shipped title, but a GOOD shipped title with a decent chance of success.

      Add these three things together, shake in a little bit of corporate malfeasance, sprinkle with a dash of Government / Regulatory apathy, and voila - you have this story.

      I'm tired of people saying the last men standing were wrong. We stayed on in good faith, believing that our hard work and dedication would be enough to get us across the line. Call it stubborn, call it stupid, but the truth is, many of us had little other options for employment. Do you know how many games industry jobs are going in WA at the moment? 0. We stayed on because we believed in our product, and our future. Financial trouble has been a given world wide for the last 18 months or more. Show some respect for the ones who had the guts to hang in there while the chips were down.

        Dude I've been exactly where you've been. Stop denying the facts and learn to be more business savvy. You as a professional now have the tools to never have this ever happen ever ever again to you.

        Work is always a mutually beneficial arrangement. The people who stayed there until the end were misled, and ignorant to what was going on around them.

        To put this into context: Transmission's HR left a few months before S hit the F. A few people noticed and left to pastures greener. The rest of the 'valiant souls' all had to scramble once everything did fall over.
        It's not noble to stay when a company is clearly about to die.

        It's just not.

          No one's going to claim that staying is noble. But staying until you have another job is practical, and if you don't have another job it is at least logical to stick with the company in case the product is actually going to see the light of day. Me, I stayed up to the end because I'm pregnant so I wasn't going to look for a new full time job. Everyone has their reasons.

          You think we all couldn't feel the impending collapse?

          Those who could find other jobs, did. Those who had more difficulty finding placements either suspended, worked part time or continued on given it was pretty much a zero-sum game.

          I, personally, wholly expected this and had full faculties of the situation long, long ago. How aware each employee was of the situation is redundant, given the systematic and routine abuse at the hands of Marty, Greg and Mike. It's just not cricket.

        Best of luck to everyone! I suffered a similar story from a games company.

        I also stayed at a games company in similar situation and I still have 3 months owed and will never receive a penny. I believed in the game, the company and the hope of everything working out like the CEO said it would. We thought we were different. Respect to staying, but it's the wrong thing to do full stop. It's just a game, it's not your life.

        When a company runs out of money and starts spending yours, it's morally bankrupt. Simple. They are _gambling_ with your money.

        I will never empower a company to gamble with my money again. A bad gambler doesn't know when to quit. A bad gambler thinks that they need to keep gambling to get out of more debt, when in reality they just keep digging a deeper hole. Just stop.

        Have a cry, wipe your tears, have a laugh about the good times. But remember never let an employer gamble with your income.

        If they can't pay, leave.

          Hey bla, which company were you working for?
          I think stories like this are really valuable to share so we can all keep an eye out for potential bad employers.

    Every time I hear yet another story like this, I'm more and more convinced that I made the right decision when I quit the industry four years ago. If you love games, and want to make games: get a boring corporate job and make games in your free time. Spend 40 hours working for The Man and 40 hours on your hobbies, you'll be happier than spending 80 hours a week in a sweatshop, and get paid more besides.

      I couldn't agree more with this statement.

    Whatever funding they have now secured is likely to only line their pockets once more. The same mismanagement & (by the sounds of it) misappropriation of funds will only continue in their new studio.

    I find it highly unlikely the finished game will be anything more than vapourware.

    Have the workers affected contacted the relevant union (in this case I believe APESMA). They have quite a bit of experience in dealing with this kind of situation.

    So what is a young perth games developer meant to do now?

    This sounds a lot like what Fuzzyeyes did a while back. Lots of talented peopele worked their arses off without pay to get Edge of Twilight out the door, then finally realised that they weren't going to be paid after months of irregular/nonexistant pay and quit. The project crashed and the CEO, Sonny Liu sold his house and fled to Taiwan. The employees have not been paid, and Sonny is starting again in Taiwan. Luckily, many of the ex-Fuzzyeyes employees found employment with reasonably stable companies like THQ Oz.

      I would think the employees would a right to seek an injunction against the company to seize all local assetts and liquidate them and get whatever financially is left over,
      Mind you they are probably too late to act now, the part completed software and anything valuable will have gone.
      Ive been caught more than once helping people work on a "great idea" it's a risk you take but still sad when they take you for a ride,
      They turn out to be experts in this and will always be one step ahead,
      Put a class action together - wait for the game to come out and when there is income from it - sue for whatever you can get.

    Now what I'm wondering is why haven't I seen this on my US Kotaku feed? This is big!

    I feel sorry for whoever Mike. It sounds like the affected workers should call the Ombudsman and if it’s a certainty that the jobs are gone let the ATO know what the assholes from the US. http://www.discount-laptops-battery.com

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