Game Publisher Cancels Contract With Developer, Then Tries To Poach Its Entire Team (bloomberg.com) 80
Three months after losing a deal with Take-Two, Star Theory Games was out of business. From a report: One Friday evening last December, employees of game designer Star Theory Games each received the same unusual recruitment message over LinkedIn. It struck them as bizarre for two reasons. One, it came from an executive producer at the publishing company funding their next video game. Two, it said the game -- in the works for the previous two years -- was being pulled from their studio. "This was an incredibly difficult decision for us to make, but it became necessary when we felt business circumstances might compromise the development, execution and integrity of the game," Michael Cook, an executive producer at Private Division, a publishing label within Take-Two Interactive Software, wrote in the message, which was reviewed by Bloomberg. "To that end, we encourage you to apply for a position with us."
It was strange and disconcerting news to Star Theory's employees. Normally, an announcement like this would be delivered in a companywide meeting or an email from Star Theory's leadership team. The contract with Take-Two was the studio's only source of revenue at the time. Without it, the independent studio was in serious trouble. The LinkedIn message went on to say Take-Two was setting up a new studio to keep working on the same game Star Theory had been developing, a sequel to the cult classic Kerbal Space Program. Take-Two was looking to hire all of Star Theory's development staff to make that happen. "We are offering a compensation package that includes a cash sign-on bonus, an excellent salary, bonus eligibility and other benefits," Cook wrote. When employees returned to the office on Monday, Star Theory founders Bob Berry and Jonathan Mavor convened an all-hands meeting. The two men had been in discussions about selling their company to Take-Two but were dissatisfied with the terms, they explained.
The game's cancellation was a shock, but the founders assured staff that Star Theory still had money in the bank and could try to sign other deals, according to five people who attended the meeting and asked not to be identified, citing the risk of litigation. Berry and Mavor encouraged employees to stick together and stay at the company. The next few weeks were chaos, employees said. Take-Two hired more than a third of Star Theory's staff, including the studio head and creative director. By March, as the coronavirus pandemic choked the global economy, any hope of saving the business appeared to be lost, and Star Theory closed its doors.
It was strange and disconcerting news to Star Theory's employees. Normally, an announcement like this would be delivered in a companywide meeting or an email from Star Theory's leadership team. The contract with Take-Two was the studio's only source of revenue at the time. Without it, the independent studio was in serious trouble. The LinkedIn message went on to say Take-Two was setting up a new studio to keep working on the same game Star Theory had been developing, a sequel to the cult classic Kerbal Space Program. Take-Two was looking to hire all of Star Theory's development staff to make that happen. "We are offering a compensation package that includes a cash sign-on bonus, an excellent salary, bonus eligibility and other benefits," Cook wrote. When employees returned to the office on Monday, Star Theory founders Bob Berry and Jonathan Mavor convened an all-hands meeting. The two men had been in discussions about selling their company to Take-Two but were dissatisfied with the terms, they explained.
The game's cancellation was a shock, but the founders assured staff that Star Theory still had money in the bank and could try to sign other deals, according to five people who attended the meeting and asked not to be identified, citing the risk of litigation. Berry and Mavor encouraged employees to stick together and stay at the company. The next few weeks were chaos, employees said. Take-Two hired more than a third of Star Theory's staff, including the studio head and creative director. By March, as the coronavirus pandemic choked the global economy, any hope of saving the business appeared to be lost, and Star Theory closed its doors.
Doing Business (Score:1)
Is the expression you're looking for.
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The only way to stop them from choking out a small business is vertical integration and independence. You need your own direct distribution capability. Should be easy for a software company.
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More than one client might also have helped.
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More than one client might also have helped.
There is plenty of companies formed around one product. When you are a small business with 30 employees, working on five or six games simultaneously with as many publishers as you have games in development is not exactly a realistic possibility. With 30 employees you have your hands full developing one or two major game titles at a time.
What happens... (Score:2)
What happens when the cash cow goes tits up? Sure there are plenty of companies formed around one product, but when a company has only one client it is always on thin ice.
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What happens when the cash cow goes tits up? Sure there are plenty of companies formed around one product, but when a company has only one client it is always on thin ice.
Then the company goes tits up. It happens all the time.
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A better strategy is to develop a generic engine and specialize it for multiple games.
If you have a "Firefight in Baghdad" game, it is pretty easy to also make a "Firefight in Kandahar".
My spouse makes iPad games and has over a dozen in the Apple app store. They are all basically the same game with different textures and a different JSON file for the content.
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Making mobile shovelware is significantly different from developing for PC or console hardware. The market and what consumers are looking for in content aren't the same.
Re:Doing Business (Score:4, Insightful)
So you're equating your spouse pumping out garbage to make money to an actual, proper game developer?
How many people do you think spent money on your spouses games only to discover that they were just textured over clones and feel like they've been conned?
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So you're equating your spouse pumping out garbage to make money to an actual, proper game developer?
Well, she's still in business and they're not ...
How many people do you think spent money on your spouses games only to discover that they were just textured over clones and feel like they've been conned?
She has mostly 5-star reviews, so I am guessing not many people noticed.
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Well, she's still in business and they're not ...
Since you're beating around the bush here I'll get straight to the point, we're questioning the honesty of your wife's trade here. Her competitors being in business or not is irrelevant to that.
She has mostly 5-star reviews, so I am guessing not many people noticed.
All I can say is to site a source. I realize the privacy issues that revolve around that but based on my own experience I find it highly doubtful your lady has made a dozen games, on her own, that are basically all reskins based on her first (your account), and that people consistently find value in them. That is com
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The Tomb Raider Level Editor community has a number of excellent developers, some of whom can create a new game by themselves in under a year. Faster development is possible with teams or small games, 3 months is not unusual. These are new games, not re-skins, and they're free as in beer. Some of the games are superb and match or exceed the quality of the original Tomb Raider series.
If people can do that sort of thing as a hobby for desktop systems, phone-type quality is surely within the range of a single
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The Tomb Raider Level Editor community has a number of excellent developers, some of whom can create a new game by themselves in under a year.
Completely different topic. Moders are not developers in the conventional sense and typically distribute their product for free given that.
If people can do that sort of thing as a hobby for desktop systems, phone-type quality is surely within the range of a single person.
We've never been talking about whether an individual can make a game on their own, you're making that up. My good buddy Dustin (whom I've known for about 20 years now) even made a decent one here https://ap2hyc.com/2015/08/int... [ap2hyc.com] . What I have been talking about from the get go was your own description of your lady's practice of just re-skinning her own prior work and se
Re: Doing Business (Score:1)
I never bothered to see if they all belong to Bill's wife but they're pumping out new ones all the time in this faux-genre.
If she was doing those she could -easily- have put a few months into the first one and then a week into each clone.
And yes people pump
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The strategy here, do not do fucking business with take two, they will fuck you over given the chance, as clear and simple as that. To steal one game, the arseholes at take two have destroyed their reputation. You would have to be stupid to do that kind of deal with take two. Many developers will now avoid take two like the plague, only the corrupt scummy developers will work with take two, hype up a game development as much as possible, milk as much money out of take two as possible whilst doing as little
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I didn't say one product. I said one client.
Star Theory was contracted to create a game. They didn't own any of the IP, it was never their product.
What you say is also true. That's why small game developers go out of business or are eaten by bigger ones all the time.
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I didn't say one product. I said one client.
Star Theory was contracted to create a game. They didn't own any of the IP, it was never their product.
What you say is also true. That's why small game developers go out of business or are eaten by bigger ones all the time.
One product or one client, is there a difference? ... either your product fails and you are bankrupt or your client cuts you loose and you go bankrupt, the risk is the same. They had the capacity to do one game on this scale, they took the risk, that's what you do. No risk no reward. I would fault them if they had messed up the game but I have a hard time faulting them for getting stabbed in the back like that. As one of their employees I would not have taken a job from that publisher simply because I would
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Yes, there's quite a bit of a difference. You own your product. Your client owns their product, you're just working on it for them.
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I used to think sports were dumb, sort of still do, but I've realized that hustle and ruthlessness have more to do with "success" than, for example, knowing lots of stuff.
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Re:Doing Business (Score:5, Insightful)
"Doing business without a good contracts lawyer" is actually a better expression.
Every business deal is a leap of faith; only a fool signs a deal with someone he thinks is untrustworthy. But relationships entered into with good intentions can sour, and your lawyer's job is to protect you against that eventuality.
It's also possible that Take Two might have committed some kind of "bad faith" contracts tort here. The problem is that civil lawsuits are a rich man's game. To bring a law suit to trial costs millions of dollars, and if someone can choke the cash flow out of your business they're fairly safe from you getting to the point where you're arguing facts in front of a jury.
Which brings me back to my first point. A good lawyer makes it not only *possible* to win when you're in the right, he makes it *practical*.
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The problem is that civil lawsuits are a rich man's game. To bring a law suit to trial costs millions of dollars, and if someone can choke the cash flow out of your business they're fairly safe from you getting to the point where you're arguing facts in front of a jury.
If you are a small fish dealing with a big fish (or even another small fish), always insist on an airtight arbitration clause.
That will prevent this very problem. Arbitration is way more accessible than the courts if your pockets are shallow.
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You *do*, however, have to be very, very careful about arbitration outfits the *other* guy wants to use.
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You *do*, however, have to be very, very careful about arbitration outfits the *other* guy wants to use.
A good arbitration clause will either specify the arbitrator or layout a fair method of selecting one to avoid bias.
At a minimum, they should be AAA certified.
AAA = American Arbitration Association
Re:Doing Business (Score:5, Funny)
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arbitration is more expensive because on top of paying your lawyer you're also paying the arbitrator
This is nonsense. The courts are not free. Filing fees often exceed what an arbitrator would cost.
Attorney fees are far less for arbitration because the process is streamlined.
Since the rules are much looser, you can often represent yourself in arbitration. That is much more difficult in court, especially if you are the plaintiff.
Well, was "No Poaching" in the contract? (Score:5, Insightful)
Did you put a "no poaching" clause in your contract that was valid after the contract completed? Or perhaps as part of your standard non-disclosure verbiage?
File suit, if you can, if not, shame on you for not having that in your boiler plate contract.. Fix your mistake next time.
Re:Well, was "No Poaching" in the contract? (Score:5, Insightful)
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Of course they aren't enforceable, and for good reasons. It protects the workers.
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Actually, I think there's probably cause for action in that you could probably make the point to the court that the other party made the contract in bad faith.
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The courts don't care if someone enters into a bad contract as long as there's nothing illegal about it. If Take Two did nothing illegal or in violation of the terms of the cont
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>> The courts don't care if someone enters into a bad contract as long as there's nothing illegal about it
MightyMartian said "bad faith", not "bad contract".
Entering into a contract "in bad faith" is a whole area of contract law !!
See for example: https://sklawyers.com.au/dictionary/bad-faith [sklawyers.com.au]
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Assuming they have enough cash left in reserve to last several years in order to last out the lawsuit, as well as pay their lawyers (as well as prove to the firm they have enough cash to last to the end of the lawsuit [required to retain a decent law firm]), and court fees during that time. I seriously doubt it, or else, they would not be in this position right now. The problem they have is that Take Two is very aware of this fact and can simply outlast them until they have to file bankruptcy, fire all th
Lawyer: that's not always needed (Score:2)
I am a lawyer, but this is not legal advice. If you want advice, pay my retainer.
It is not always necessary to have such things in a contract (but is certainly helpful).
*All* contracts have an implied covenant of good faith.
On top of the, torts of "interference with contract" and "interference with prospective advantage" exist. These are generally hard and harder to prove (perhaps even harder and hardest), often due to the lack of sufficient relationship or duty.
In my decades of practice, I've never b be
AAA! (Score:3)
Total dick move by Take Two to save a few bucks. But does anyone really expect anything different from AAA publishers at this point? Microtransactions seem likely now. Day 1 DLC is a given. Console optimized with a PC release as an afterthought.
Sdly, Take Two has the license, so not much can be done.
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I just hope KSP mod maintainers stay interested in KSP1. A whole lot of mods were abandoned after the KSP2 announcement, and they've been struggling to find new maintainers.
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Not a bad idea (Score:2)
Yes, it's a dick move. But at the same time, if you have a company with no intellectual property of its own and a CEO who doesn't add much value to the company, but who wants to get paid millions of dollars for just walking away while the employees just get crumbs, then it could be worth the revolt for the employees.
After all, not all CEOs are perfect, some are alcoholics, some are sexual predators, some only promote their family and friends, and some are just plain not worth the exponential compensation th
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Similar things
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Another side of the coin.
Total dick move by studio owners. They demand far more than they are worth for buy when they're just a subcontractor working on someone else's project, and then lie to their employees so they don't take better terms with another company, causing many to lose their jobs.
Business is like that.
1 "customer" (Score:5, Insightful)
If you only have one customer, then you're already a wholly owned subsidiary. You're just missing some paperwork.
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This is pretty common for small production companies: they don't have enough employees to work on multiple games/movies at once, so all their revenue comes from their current project. They need to either line up the next project before the current one winds down, or pare down to a skeleton crew until they can land the next deal. It can be a very hand-to-mouth business and unexpectedly losing a client can kill them.
Re:1 "customer" (Score:5, Insightful)
If you only have one customer, then you're already a wholly owned subsidiary. You're just missing some paperwork.
You have to start somewhere... One customer is just a start.
You are correct if all you can muster up is one contract from one customer they pretty much run your business. But knowing this, one should manage their cash flow accordingly and have a plan in place to deal with the loss of a contract. If the plan is to shutter the business, then that's what you do.
In this case, apparently, they where actually negotiating a sale of the company, which fell through. I suspect they didn't really understand the situation before them, overpriced the company and made it much cheaper to just get their employees poached and cut adrift. Not having contractual leverage to prevent this (with the other company or the employees), the company got shuttered. Seems like lack of planning to me.
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Service companies (game development, training, legal, design, consulting) mostly have value in three things - employees, IP and longer-term contracts. Guess what - if are selling your company to that one customer who owns the IP, the value of the contract is a bit irrelevant, and if you don't have airtight noncompete clauses, you will soon find out that the value is in individual employees and you do not own them - they can decide to take their value somewhere else
Newsflash: water is wet (Score:3)
This is news?
If you've worked in the advertising, agency, or large system-integrations world this happens ALL THE TIME. It's a way to cut costs and trim the dead weight.
A few years back my office had over 100 people working on websites and marketing campaigns for an auto manufacturer. The client switched to a different agency (consolidating contracts for billing savings) and then the "new" agency poached all the talented people who were working on the account.
No-compete clauses are illegal in some states because they unfairly limit the employee's options. This is the other side of the same coin.
Game publisher tries to poach development team (Score:4, Funny)
Not sure it's a good idea. Have they considered boiled, steamed, sautéed, fricasseed or fried?
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They can get fried developer during crunch time! /s
Ba-dum-tss.
Some of the games I've shipped involved crunch time -- crunch time is almost always a sign of poor management: poor estimates, and poor scheduling.
--
Q. Is transgender a mental illness?
A. Only a spiritual moron mutilates their physical body instead of respecting it. Trying to hijack the definition of an outlier to be "normal" doesn't make it so regardless of what you feel.
Anyone who can find another job ... (Score:2)
and signs with the company is an idiot.
Whatever they promise at the first opportunity they will screw you over.
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and signs with the company is an idiot.
Whatever they promise at the first opportunity they will screw you over.
Yea, but if the company you are leaving is assuming room temperature because of the loss of the contract, what else would you suggest?
Sure they may treat you like garbage, but in the time left for the development project you are on the pay checks will keep coming. Not to mention that game development is pretty much like this. You work a project until it dies or finishes and you get cut loose to fend for yourself. It's how the contracting gig works.
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Anyone who can find another job signs contracts with anti-poaching agreements everyday.
Because the term poaching comes when the company comes to you with a job offer in hand. It's perfectly legal even with anti-poach to approach the company asking if they have any job opportunities.
If you're talented, anti-poaching agreements are meaningless. When a company wants you, there are so many ways around it.
I've seen companies simply call up an employee, then just mention that they might want to apply for a job us
Re: Anyone who can find another job ... (Score:1)
"Hey, it's been a long time since I left, I was thinking about you yesterday during our recruiting budget meeting. Want to get coffee?"
Followed by coffee and first official contact is employee sending resume.
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Whatever they promise at the first opportunity they will screw you over.
The above statement is true of ANY company as soon as they can make more money by doing so. Real dickhead companies will screw you over not just for profit, but because the manager can't stand you getting 'the better part of the deal;' even if the company will lose money by doing so. This latter behavior personally baffles me, but, I've encountered it enough to know it is common.
KSP was a work of passion. (Score:5, Insightful)
The original developer of Kerbal Space Program left on a relative high note 4 years ago with this reddit post:
https://www.reddit.com/r/Kerba... [reddit.com]
The game kept in development nicely, and went onto the usual cycle of yearly sales and mods for a very popular game.
Take 2 wanted to do the EA thing, where they take a very popular community or passion project, spin out a cash-in sequel, then extract all the development talent into their studios.
Here, they decided they didn't even have to do that, and could just extract the developers and just OWN the game IP based on a tentative contract while they pushed the company into bankruptcy.
Lots of moving parts in this story - but there's a reason that indie developers tend to jump ship pretty often.
Business folks quite reasonably want to pop in, get ownership of something, then jump out with ownership of something they can trade of leverage for as little effort as they can. It's all about the money multiplication to effort ratio.
Developers that care about the results of the things they create will see how the more business agreements they get - the more obligations take up more of their time every couple of interactions, and will want to just reset it all fairly often just to focus on what they care about.
The net effect of all this over several cycles is the business folks playing these games in markets destroys and stagnates the market, until a new market pops up and repeats the cycle - or a decent developer sneaks through and shocks everyone with a surprise quality product with heartfelt effort involved.
Then the business guys push to take apart their efforts, and start the cycle by trying to own or copycat it with minimal research with lowball developers treated like interchangeable parts.
There's a LOT more business folks than passionate developers able to freely make great stuff - thus, the dance of the ones who've had a taste of that hopping around for a chance to do something they care about.
Ryan Fenton
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It really sucks for the employees - the ones that didn't jump ship, in good faith.
I learned way back that having pride and faith in the work you produce is all that counts, having loyalty to the company you work for as a hired gun, assuming you have no real ownership or say in the business, is a fools errand.
I've jumped ship out of three companies over the last 15 years, just before the shit hit the fan.
You can usually see these things on the horizon and plan ahead, but it's a shitty time for all concerned
Non solicitation - the legal terms. (Score:5, Informative)
Someone else wrote "non-poaching" but to be precise when you start mergers/acquisitions ("m&a") discussions there are four things you MUST have ... above.
- 1. Nondisclosure. What we share with you (financials, etc.) that isn't already materially public, you don't get to share. If you do, you pay us.
- 2. Noncompete. What we share with you (customers, vendors) etc... you won't use to compete with us. If you do... see above.
- 3. Nonsolicitation. You won't hire our staff, take our vendors, customers, affiliates, etc. If
- 4. Due Diligence. You'll get to inspect our stuff of course... but WE get to inspect YOUR stuff. We don't want to be acquired by a dying company or a company almost out of money seeking to resurrect themselves on OUR effort.
Sad object lesson - good devs are out of a job and another company making cool software has failed.
E
Was Take-Two Negotiating in Good Faith ? (Score:1)
Either they were not negotiating in good faith ... or they are low life bottom feeders to put a company (not a competitor) out of business.
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I shocked, shocked, I tell you that a company that made its mark with a franchise built on carjacking and running down law enforcement would engage in anything shady.
Motherfuckers (Score:2)
Another company for the blacklist. Fuck, that's like all the big publishers, now, isn't it?
Is the fate of every cool video game company to become raging assholes? Is the only way to survive to become the bastards you defeated?
Remember that Activision was founded to give game developers the credit and compensation that Atari refused. When EA started they promoted their developers and artists like they were literal rock stars.
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Well, the reason that they all become raging assholes has nothing to due with survival. What happens is, when they become successful with a few popular titles, banks and Wall Street move in and buy out everybody that cares about quality over profit because they can sell stock solely based off the IP rights of the successful titles without developing an actual game. They can start development of a lowball piece of crap based off the leveraged IP and make a killing selling the stock before the game nears c
Glad to See Schreier Continue to Cover Gaming (Score:2)
The author of this article, Jason Schreier, is one of the few true investigative reports in games journalism. He recently left Kotaku, and I think this is his first big story on Bloomberg. Given Bloomberg's audience, I was curious to see how his reporting would change, and I'm glad to see he's still very involved in the games industry coverage.
Happens all the time, (Score:2)
Back in the 90s, HP had a OEM developer in the rust belt, a garage startup with one brilliant prof, and a couple of his grad students. HP was their sole source of revenue and they hired the key founder grad student and cancelled the contract. But the story had a different ending. They persevered and then got some breakthroughs in someth
How is this legal? Who owns the IP? (Score:2)
Also, no nonsolicitation (of developer/designer staff) clause in the agreement?
Star Theory Games must have had shit lawyers, or none at all, when concluding their agreement with the publisher.
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Take2 bought the rights to it from Monkey Squad, and contracted Star Theory to make KSP2
flip them the bird (Score:2)
Sequel to Hit Indie Game Ruined By Big Studio (Score:1)
Don't outsource key tasks!!! (Score:1)
Obvious rules in business:
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Seeing a pattern (Score:1)
Help me get my millions, pretty please (Score:1)
The two men had been in discussions about selling their company to Take-Two but were dissatisfied with the terms, they explained.
Berry and Mavor encouraged employees to stick together and stay at the company.
So, stick with us even though we have been trying to sell the company out from under you so we can make our millions. Never mind that you would end up with a new employer, we got ours! Don't abandon us to go to the same company we were pawning you off to yet, we haven't cashed in. Loyalty. Loyalty. Loyalty!!!!!!!
Holy hell. The nerve of some people.