Judge dismisses THQ-WWE racketeering suit

Litigation from 2004 tossed out by judge, but legal battles not over yet for wrestling organization and its gaming licensee.

One more chapter of the ongoing legal dispute between World Wrestling Entertainment and its game and toy licensees, THQ and Jakks Pacific, is in the books. Earlier this month, a United States District Court judge dismissed a WWE lawsuit brought against the game makers and multiple other parties.

Originally filed in 2004, the suit claimed that Jakks Pacific had bribed WWE agents in charge of external licensing to circumvent a competitive bidding process and secure rights at below-market values. The wrestling group alleged that Jakks paid the agents to discourage other companies from even bidding for a license to make toys or games.

The WWE suit accused the associated parties of numerous wrongdoings, including violation of the federal Racketeer Influenced and Corrupt Organizations Act (RICO). As a result, the WWE had been asking for the court to nullify its licensing agreements with THQ, Jakks, and their joint venture, as well as to pay for damages incurred as a result of fraud.

On December 3, the judge in the case granted the defendants' various motions to dismiss the suit. While no explanation was given for the dismissal, the judge did indicate that a full opinion on the matter "will be issued in short order." In THQ's motion, the publisher asked the judge to dismiss the RICO claim with prejudice and to dismiss the remainder of the claims because they weren't federal issues.

While THQ came out on top in this bit of WWE-related litigation, the wrestling organization's attorneys aren't tapping out just yet. Last October the company filed another suit seeking to void its licensing agreement with THQ, this one centering around the publisher's sublicensing of Asian distribution rights to SmackDown franchise developer Yuke's.

As of press time, a THQ representative had not returned a request for comment.

By Brendan Sinclair -- GameSpot

Obsidian developing Sega's Alien RPG

Some acclaimed creative minds have been involved in the Alien franchise, including directors Ridley Scott, James Cameron, and David Fincher, who crafted the sterile, spooky sci-fi movies, and Swiss surrealist H.R. Giger, who created the looks for the titular creatures.

cyber games news

Gamers can add one more name to that list, as Sega today announced that role-playing-game specialist Obsidian Entertainment is developing the upcoming RPG set in the Alien universe.

The game, which as of now remains untitled, is coming to PCs and "next-generation systems." Sega has not dated the project, but on Monday said the first Alien-licensed game wouldn't arrive before 2009. No further details of the game were mentioned.

With Monday's announcement, Sega also revealed that a first-person shooter based on the movies was also in development, but did not reveal the game's developer. However, Internet reports, including one from Gaming Target, noticed a few company names in the copyrights on Sega's Alien teaser page.

Along with mention of Obsidian, which was confirmed today, was Gearbox Software, the team behind the Brothers in Arms franchise. The two names were quickly removed, according to Gaming Target, and as of press time and following today's news, Obsidian's name was back on the page.

Sega did not respond to requests for comment as of press time.

By Tim Surette, GameSpot
cyber games news

Take-Two feels heat in $$ scandal

The execs at Grand Theft Auto publisher Take-Two Interactive, Inc. suffered yet another public humiliation. In documents filed with the Securities and Exchange Commission (SEC) today and in a statement released to the public, investors, and the press, the Grand Theft Auo and Bully publisher outlined the conclusion of an internal investigation designed to ferret out wrongdoing related to the granting of stock options.

The ferret has spoken, and it has smelled a rat.

In a statement, the company said that an independent committee found "there were improprieties in the process of granting and documenting stock options and that incorrect measurement dates for certain stock option grants were used for financial accounting purposes."

The company said it will need to "restate historical financial statements to record non-cash charges for compensation expense relating to past stock option grants," and that "all consolidated financial statements, earnings releases and similar communications issued by the Company containing financial information for periods beginning 1997 through April 30, 2006 should no longer be relied upon."

According to the statement, the internal investigation--which could negate the financial reporting of Take-Two for the past 10 years--found no misconduct by either CEO and president Paul Eibeler or CFO Karl Winters.

Along with more than a hundred other publicly traded companies (including CNET Networks, the owner of GameSpot), Take-Two is under investigation by the SEC for practices related to the granting of stock options, specifically the back-dating of options, a practice which is designed to circumvent SEC rules and invariably puts more money into the pockets of a select group of company officials. Today's statement has no impact on that still-ongoing investigation announced in July.

The publisher is no stranger to the SEC, recently paying $7.5 million to settle an SEC lawsuit brought in 2005. The SEC alleged the company had overstated financial results from 2000 to 2001.

Today's news, released before the markets opened, erased Friday's uptick. On Friday, shares in the company rose 2.9 percent to $20.10 for the day; today, Take-Two shares shed 2.4 percent, closing at $19.66.

Financial writer Herb Greenberg stated in his MarketWatch blog today, "when you see such blatant wrongdoing, you can't help but wonder (with any company) where else the company might have been acting too aggressively for its own good...[and yet] investors continue to flock to Take-Two (and other stocks) as if all is well in its (their) world. Remarkable."

By Curt Feldman -- GameSpot