Gearbox Software acquired the rights to the Duke Nukem IP which included the games Duke Begins and the long unreleased Duke Nukem Forever. After Gearbox took over development of the long awaited Duke Nukem Forever and finally released in 2011, the original owners, 3D Realms Entertainment, is suing Gearbox Software for unpaid royalties.
3D Realms Entertainment, or Apogee Software, believes Gearbox Software still owes $2 million in royalties from the sales Duke Nukem Forever and payments for the Duke Nukem property.
In addition to the Gearbox Software purchasing the rights to Duke Nukem, they also agreed to pay a $2.9 million debt 3D Realms owed another company. Gearbox also agreed to provide 3D Realms with a percentage of royalties for every future Duke Nukem title.
When speaking to Law360, Gearbox denied all reports and stated that, “Gearbox, in fulfillment of its commitments, enriched 3D Realms, saved 3DR from its debts and rescued 3DR from its failed dozen plus year attempt to ship Duke Nukem Forever.”
Despite fan demand for the extraordinarily long awaited game, Gearbox did not benefit financially from the acquisition.
"While 3DR might not wish the reality that the results make clear, 3DR turned out to be the only beneficiary of the deal," said Gearbox in response to the sales. "Gearbox Software, meanwhile, experienced damage to its credibility and loss of its money.”
On the other side, 3D Realms claims that Gearbox did not fulfil the entirety of their initial agreement, and Gearbox even stopped them from conducting an audit of Gearbox's royalties.
“3D Realms has therefore been required to file this lawsuit to enforce the purchase agreement, to recover the amounts due and owing from Gearbox and to enforce the audit right provided by the agreement to enable it to conduct an audit of Gearbox’s royalties,” the complaint details.
3D Realms claims that they already requested Gearbox bring in an independent auditor, but refused.
Of the $2.9 million loan 3D Realms found themselves in debt with, they claim that Gearbox still needs to pay a remaining $800,000 and any royalties on the $4.5 million Gearbox received from Duke Nukem. Under the purchase agreement, 3D Realms also notes that Gearbox should pay considerably more than $500,000 in future advances
To make things even more complicated, "Gearbox now claims that it is entitled to first deduct the full amount of the debt it assumed ($2.9 million loan) before any royalty payments become due to 3D Realms."
No word as to the current status of 3D Realms' endeavour to sue Gearbox Software.
Source: Gamefront
