Forgot your password?
typodupeerror
Australia Businesses Games

Perth Game Company CEO Takes IP By Night 356

Posted by timothy
from the not-a-dwelling-place-so-not-burglary dept.
snicho99 writes "A US owned gaming company has fled Australia, leaving unpaid employees and a massive tax bill. Apparently many staff have been working unpaid for months to allow their game to ship and hopefully the company to recover. Interzone's Perth (Western Australia) office was created with the assistance of a state government grant. Last week Interzone's (American) CEO entered the building at night and removed all the servers and IP so that Interzone could continue production at a new company they have opened in Ireland. The staff caught him on camera. More background here."
This discussion has been archived. No new comments can be posted.

Perth Game Company CEO Takes IP By Night

Comments Filter:
  • Call wikipedia (Score:4, Insightful)

    by bl8n8r (649187) on Saturday February 20, 2010 @08:03AM (#31209280)

    There's a new poster child available for the "ConnivingBastard PrickManager" definition.

    • Re: (Score:2, Funny)

      by Anonymous Coward

      Dont' power lines runs reverse in Perth so he ca't use their servers in northern Ireland? If so he has to pay for all the shipment so he's out some spooners, ay mattey?

    • Re: (Score:2, Insightful)

      by PopeRatzo (965947) *

      This isn't such a big deal.

      Here in the US, we've had entire industries do this to their workers. It's called "free-market capitalism" writ large.

      The only interesting thing is that Interzone did this to technology workers.

      Maybe it's time the techies realized that they are working class and not the professional class many have thought of themselves. And management really is out to fuck you over.

      • by Anonymous Coward on Saturday February 20, 2010 @10:56AM (#31209998)

        It's refreshing to see an American CEO that actually knows enough about his own company to know what to steal.

      • Re:Call wikipedia (Score:5, Interesting)

        by Antique Geekmeister (740220) on Saturday February 20, 2010 @10:59AM (#31210010)

        No, it's interesting that the manager showed up and seized the equipment without an opportunity for employees to clear personal data or office possessions. That's pretty unusual.

        I've seen small companies closing their doors under different, but similarly awful circumstances. (Power being cut, losing their network feed due to non-payment, unpaid-for equipment being seized, etc.) An important rule for employees facing such troubles is to make sure you have all legal documents in off-site backup. Follow your contracts, but make sure your payment records, stock information, signed contracts, etc. are available offline. And consider whether to back up your work and email offsite or on separate media: I've actually been offered a return consulting job to come back and reconstruct work that I'd done and they'd deleted all source code for, as part of purging my old accounts. Since I;d been there as a corporate partner, and they tried to pay me under the table and not notify my company, I contacted our sales and legal departments. It turned out they hadn't paid six months of outstanding bills, and hiring me behind my company's back would have been much cheaper for them and much more profitable for me, but would have left my employer with much less leverage to get paid.

        Fortunately for me, the key work I'd done had actually already been submitted to the relevant open source project's main codelines, so it wasn't lost. And they hadn't noticed the explanations in my contract about what working on GPL tools nad publishing them to that client meant, that they were under GPL. We actually managed to get them to cough up at least some of the backpay, mostly for explaining where to to get the updates.

    • Re:Call wikipedia (Score:5, Interesting)

      by u38cg (607297) <calum@callingthetune.co.uk> on Saturday February 20, 2010 @11:06AM (#31210052) Homepage
      Interestingly, this is almost exactly what the US headquarters of Lehman Brothers did immediately before the collapse - repatriated all the cash from overseas operations to pay US staff and creditors before anyone else.
  • by QuoteMstr (55051) <dan.colascione@gmail.com> on Saturday February 20, 2010 @08:06AM (#31209290)

    A CEO may pay what His he wishes to His employees and take what He wants.
    By His accumulation wealth, a CEO has demonstrated His worldly talent and divine favor. Far be it for us to criticize His actions: are we yet men, while He has a golden MBA? While we merely use our power of Speech, does the CEO not expand the language with outflowing of His prodigious mind? Does that not giveth unto him wisdom we know not, and authority we dare not assert?

    We should open our hearts to the CEO. We shall work for Him all our waking hours and offer unto him our wives and daughters for His amusement: for we should be honored to have a radiant Being in our lives as the prime-most consideration.

    Should we Fail, we deserve whatever punishment the CEO shall mete out for He, as he so frequently reminds us, is infallible. If a CEO's Company should fail, it is our fault for being indolent, and we shall bear that around our necks. All the remaining resources of a failed Company will go to its CEO as compensation for even attempting to deal with filty being like ourselves. Amen.

  • by Anonymous Coward on Saturday February 20, 2010 @08:22AM (#31209358)
    There are times when internet hate campaigns get well out of hand, and end up causing huge amounts of trouble for people over trivial or non-existent issues.

    This is not one of those times... Take it away, internet...
  • Is this sort of thing legal?

    Oh wait. Yeah, I guess not.

    • Re: (Score:2, Insightful)

      by jonadab (583620)
      If it were legal, he wouldn't have been doing it in the middle of the night. The company could have just locked the employees out and done whatever they wanted in broad daylight. Plenty of companies have been known to do that sort of thing when shutting down a location.

      I mean, this is a CEO we're talking about. Those guys normally work 9-5, officially, on paper, and in practice this turns into more like 10-4, except on days when they're out of the office for "meetings" with other CEOs on the golf course.
      • Re: (Score:3, Interesting)

        by karnal (22275)

        I can tell you personally that the large company CEOs don't work "10-4" - more like 24x7.... the job is their life.

        So much so that I know one that has a Plasma in his staff meeting room for when he's in on weekends to watch while working because he's ALWAYS at work.

        Sounds to me like this "CEO" is just someone who's also a con-man.

  • by Anonymous Coward on Saturday February 20, 2010 @08:29AM (#31209400)
    Interzone owns the Australia Tax Office (ATO) approximately $1m AUD and $500k in unpaid wages and superannuation. The owner changed the locks on the firm at 4am in the morning, locking all employees out from their work. Not even given a chance to collect their personal belongings. A new 'Interzone' called Big Collision is being setup in Dublin Ireland to complete development of their game Futebol in time for the World Cup, and without the debt they have accumulated in Australia. Originally Interzone was given a grant by the Western Australian goverment of $500k, so this has blown up very big on the news there, causing quite some political issues and questions of the chief Treasurer. They did not even lay off the staff, as that would of caused paper work, and the paying out of their due wages and redundancy money. They were simple locked out from their building.
    The firm that provides the middleware (BigWorld) based in Sydney, provided a server engineer (contracted by Mike to clear out the IP assets from the server.)

    The Interzone employees have been fantastic, in collecting evidence, and staying together to fight for what they are due.

    This is not the first time this has occured in Australia, similar shit has happened in the last year with firms Transmission, and Fuzzyeyes. Video games, one of the last places for cow-boy businessmen.

    For people who would like to read more on this, check these links:
    http://www.tsumea.com/australasia/australia/news/120210/interzone-games-perth-closes-staff-locked-out [tsumea.com]
    http://www.kotaku.com.au/2010/02/wa-dev-interzone-games-close-to-liquidation/ [kotaku.com.au]
    http://www.kotaku.com.au/2010/02/interzone-ceo-marty-brickey-responds/ [kotaku.com.au]
    And this video where the employees confront one of the directors http://vimeo.com/9574704 [vimeo.com]
    • Re: (Score:2, Offtopic)

      by deniable (76198)
      Hate to tell you this, but I haven't seen anything about this in Perth. This is the first I've heard of it. 'Chief Treasurer' as you put it would be the Treasurer, Troy Buswell. He's also Minister for Commerce and the grant likely came from the part of DOIR that now works for him. It's a Commerce matter, not Treasury and Finance, but he's been quiet on both fronts.
    • Re: (Score:3, Interesting)

      by Genda (560240)

      This is not the first time this has occurred in Australia, similar shit has happened in the last year with firms Transmission, and Fuzzyeyes. Video games, one of the last places for cow-boy businessmen.

      Actually, I belief this is a misrepresentation... I would argue that these are not "Cow-Boy Businessmen", but "Cow-Dung Businessmen". These fecal administrators, give scum of the earth a bad name. If there was any justice, they'd be plowed into a field so as to provide their only possible positive contribu

    • Re: (Score:3, Interesting)

      by initialE (758110)

      So how did it turn out at those other firms?

  • by deniable (76198) on Saturday February 20, 2010 @08:31AM (#31209410)
    If this guy is a director and knowingly traded while insolvent / unable to pay the bills, he's looking at five years in prison. Once ASIC gets done, the ATO will start looking at tax issues. This guy is going to be a bureaucrat chew toy.
    • Re: (Score:3, Informative)

      by Anonymous Coward

      ASIC were fully aware what was going on. I'm afriad to tell you as an Australian citizen who BEGGED ASIC to take action, that ASIC are a bunch of pussies and toothless tigers.

      John Howard and the former Liberal Government watered down ASIC's powers to the point that they are nothing more than a wasteful public entity paying lip service - they only care about the "big fish" that they cannot ignore (due to press coverage), and as recent media coverage over the last six months has shown, they can't even catch p

  • Australia has an extradition agreement [comlaw.gov.au] with the U.S.

    The offences that are extraditable include:

    11. Robbery.
    12. Burglary; housebreaking or any similar offence.
    13. Larceny.
    14. Embezzlement.
    15. Obtaining any property, money or valuable securities by false pretences or other form of deception.

    I suspect this will not end well.

    • Re: (Score:3, Insightful)

      by Zumbs (1241138)
      Given that the asshole fled to Ireland and started a "new" firm, the interesting question is the extradition agreement between Ireland and Australia. Unfortunately, the link to the Australia-Ireland agreement on this page [ag.gov.au] links to the Australia-Indonesia page ...
    • That'll come in useful - if he ever moves there or Ireland gets admitted to the Union.

  • What? (Score:4, Funny)

    by dangitman (862676) on Saturday February 20, 2010 @09:02AM (#31209520)

    Last week Interzone's (American) CEO entered the building at night and removed all the servers and IP so that Interzone could continue production at a new company they have opened in Ireland. The staff caught him on camera.

    As much as I think that Mike Turner is a total scumbag, the linked video doesn't actually show him being caught in the act of removing anything. It does show him to be consistently wearing those crappy white iPod/iPhone earbuds - but while that probably should be a crime, it isn't currently on the books.

    • Re: (Score:2, Interesting)

      by Anonymous Coward

      The FULL video shows him exiting Interzone Perth Offices at around the same time a Police report was filed by employees claiming that there was someone in their building illegally, and this pattern was repeated over several days. The only way that he got away with this was by conitinuing to provide the Police with phony documentation, and quite probably by bribing the building manager of the office, who provided the Police with ammunition to keep employees off the property. It's worth noting that the past T

  • disgusting ... (Score:3, Insightful)

    by Lazy Jones (8403) on Saturday February 20, 2010 @09:03AM (#31209526) Homepage Journal
    even if he gets away with this, his new employees will probably think twice before working on unpaid wages for so long. Also, a publisher should certainly be wary of someone with such dubious business practices.
  • by Pedrito (94783)
    I'm glad to see a CEO so devoted to getting his game out for the fans. Screw the developers. It's the fans that matter!
  • Hard Luck (Score:5, Insightful)

    by BlackHawk-666 (560896) <ivan.hawkes@gmail.com> on Saturday February 20, 2010 @09:40AM (#31209678) Homepage

    Hard luck there for all the people who just got scammed by a run of the mill business asshole. My theory is that they are all lying assholes, each and every one of them, and if you keep that in mind you'll find your dealings with them go much better. Just remind yourself as they speak that every word is carefully selected to make them richer.

    Big tip - the day you find your pay hasn't gone into your account is the day you hit jobsearch.com or call your agent and let them know you're looking for paid work.

    The business's responsibility is to ensure there is enough cash set aside against bad luck/planning/weather and enough cash flow coming through to ensure projects get completed. It's *their* responsibility, not yours...you write code, or run tests, answer the phones. If they've f*ed up enough to not have the money to even pay the people who write the product, then you have to wonder how else they are screwing up.

    • Re:Hard Luck (Score:5, Informative)

      by supremebob (574732) <.moc.seiticoeg. .ta. .yknujemeht.> on Saturday February 20, 2010 @10:05AM (#31209782) Journal

      It's sad that these folks needed to learn this the hard way, but it's important to know that you need to get the hell out of a business that can't meet payroll. Start looking for a new job right away, and make sure to file a claim to the labor relations organization for that jurisdiction if you don't get your back pay in a timely manner. Paying your employees is a top priority and a legal obligation for any business, whether or not they are for-profit or non-profit. (Sad, but I have a friend who got stiffed by a church of all places)

      If a company don't have the funds available to pay it's people, they're already screwed. It's only a matter of time before they either close up shop or their creditors shut the place down at that point.

    • Tough titties? (Score:3, Insightful)

      by rsilvergun (571051)
      I notice when a business owner makes off with half a mil in a assets (unpaid wages) it's tough titties but if one of the employees had done the same thing to him the frickin' justice dept extradites his ass and throws him in jail.
  • I applied for a job there once. I am glad I didn't end up with it otherwise there is a good chance I may have ended up in all this mess.

  • Well, if hes the CEO, its legally his stuff. The employees work for the company and they don't normally have ownership rights of their work. Happens all the time when companies go under and restructure

    Now, bailing out on their salaries, that's uncool and something to get upset over. ( but it also happens when companies go out of business...)

  • In the us you can go to jail for having your workers go unpaid and the IRS will also hunt your down for the unpaid tax.

    This CEO needs to do some HARD TIME and not that easy lockup they have in australia.

  • legal (Score:3, Interesting)

    by DaveGod (703167) on Saturday February 20, 2010 @12:38PM (#31210616)

    This could be mostly legal, the servers may have always been owned by the parent company and leased back to the Australian subsidiary. The IP very likely was also never owned by the Australian firm. If the subsidiary did hold assets I expect the parent company had security over them, so if they had loaned the subsidiary money then in the event of being wound up they take control of the assets. Lying to creditors/employees on the other hand, well there's a mess there but it's probably wrongful trading etc on the part of the subsidiary's directors while the parent's may or may not have known.

    It will be up to the administrator to find out if there is anything to be done, and the employees, in their position as creditors, should be applying their pressure on him. The company may have knowingly traded whilst insolvent in which case the directors may be charged with wrongful trading, and potentially be personally liable for debts. The nature of the relationship with the parent company and related transactions may also offer some scope - it's not unheard of for courts to lift the veil and treat parent & subsidiary undertakings as one entity. Furthermore he may well be able to show the parent acted as a shadow director. There is room for some optimism here for two reasons, firstly a "million dollar tax bill" implies profits (though it may be tax on salaries that hasn't been paid over). Secondly the government grant should have all sorts of covenants, you have to be an utterly incompetent complete idiot to grant or loan money to any subsidiary and not enforce appropriate covenants and security over the parent company.

    While I sympathise with the employees, there were lots of things they could have done, and given the amounts they should have taken some advice. Sure, in start-ups it's not uncommon for employees to give some leeway and "muck in". But this is a subsidiary! Why do this if there is a parent with money? Secondly, if you're a creditor, act like one. Take a look at the accounts, check for assets and file security over them. Negotiate for some equity - if they had just 20% between them minority protections kick in. An accountant probably would have given them this advice for free if they suggested that some audit fees might be coming their way later on.

  • by Macfox (50100) on Saturday February 20, 2010 @11:13PM (#31215614) Homepage

    I sympathise with the employees. I went through a similar situation in 2007.

    GEERS is your friend*, and the liquidator will help you with the information needed to complete your GEERS application. Unfortunately GEERS doesn't cover unpaid super and most companies in these circumstances just fail to pay super and accumulate fines for late super payments rather than the actual amount.

    As the law currently stands it very simple for dodgy CEO's to thieve the IP and take operations overseas. The ATO and ASIC are either too slow, bogged down with redtape or just plain toothless.

    The sad fact is CEO's/directors don't even need to move overseas. All you need to do is have a parent company overseas that the IP is assigned to. The local company then operates on the smell of an oily rag, runs up liabilities and even gets government RD grants/tax rebates. When creditors/employees come to collect, there's nothing, but a bit of office equipment and furniture. It's even possible to start a new company and then buy the salvaged office assets of the previous company and even trade from the very same office and the ATO and ASIC don't even batter an eye lid.

    *As for GEERS and the liquidator, chase them ruthlessly. The department/program is biased to the liquidators findings. If there's incomplete, incorrect or absent employee entitlement records (as is often the case with poorly run companies), GEERS will not pay you a cent, if the liquidator can't provide support or evidence of he amounts. (I found out the hard way and lost 2 years AL)

    All the best with your fight.

  • by Animats (122034) on Sunday February 21, 2010 @05:21PM (#31221998) Homepage

    The management moved to Ireland? That's a bad place to go bankrupt, [dilloneustace.ie] and a good place to sue creditors. Ireland still has bankruptcy law left over from the days when English landlords ran the country. Creditors can put a company or an individual into involuntary bankruptcy. There's nothing like "debtor in possession" bankruptcy (US "Chapter 11") in Ireland. Personal bankruptcy? The debtor may retain "such articles of clothing, household furniture, bedding, tools and equipment of his trade or profession or other necessities for himself, his wife, his children, and other dependent relatives living with him, as he may select, not exceeding in value EUR 3,175."

    It gets worse. Bankruptcies put individuals on a public blacklist. Officers of companies that go bankrupt can't be officers of a company again. Individuals can't get credit of more than EUR 630.

    The employees need to get a judgment in Australia against the CEO, which shouldn't be hard since he fled the country with unpaid employees. Then hire an aggressive collection agency in Dublin. [eircollect.com] ("100% success rate for many clients. No collection, no fee.") There are international collection agencies, such as Global Credit Solutions, with branches in 80 countries. They have offices in both Australia and Ireland.

The unfacts, did we have them, are too imprecisely few to warrant our certitude.

Working...