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In-Depth: Activision Adds EA To $400M Cross-Complaint Against West, Zampella

In-Depth: Activision Adds EA To $400M Cross-Complaint Against West, Zampella

December 21, 2010 | By Kris Graft, Leigh Alexander, Staff

December 21, 2010 | By Kris Graft, Leigh Alexander, Staff
More: Console/PC

Activision on Tuesday filed to amend a cross-complaint in the case involving former Infinity Ward heads Jason West and Vince Zampella by adding rival Electronic Arts as a defendant, and claiming "unlawful conduct" from "the highest levels" at EA, including CEO John Riccitiello.

The strongly worded amended cross-complaint, obtained by Gamasutra, alleges that EA conspired with West and Zampella to encourage the two to break their contract with Activision, a contract that still had over two years left. Infinity Ward is the original creator of the Call of Duty military shooter franchise, which has generated billions of dollars.

The original cross-complaint, filed this April in response to a lawsuit from Zampella and West, also accused the two executives of meeting with EA executives while still employed at Activision, but now counsel for Activision believes it has more evidence of breach of contract and fiduciary duty.

Activision is now naming EA alongside West and Zampella as alleged co-conspirators. Activision claims that negotiations began as early as July 2009, about eight months before the two executives were ousted from Activision.

EA VP of corporate communications Jeff Brown responded to the suit in an email to Gamasutra: "This is a PR play filled with pettiness and deliberate misdirection. Activision wants to hide the fact that they have no credible response to the claim of two artists who were fired and now just want to get paid for their work."

Along the way, Activision alleged that EA "conspired to set up an independent company staffed by key Activision employees, including designers, programmers, artists, and others from Activision’s Infinity Ward development studio, thus draining the studio of talent and potentially delaying future Call of Duty games."

This alleged behavior was encouraged by EA and the Creative Artists Agency, according to Activision's claim, "with full knowledge that the executives were under contract and legally committed to Activision for more than two additional years."

The amended suit claimed that West and Zampella, "emboldened by their secret alliance with Electronic Arts, the executives refused to adhere to even the minimal standards of behavior required of any employee or executive."

Alleged Insubordination

Specifically, the pair are accused of being uncooperative regarding the Call of Duty franchise, allegedly refusing to work with Treyarch on a unified brand. Activision also claims that West and Zampella refused to cooperate with the process that would allow Infinity Ward developers to be paid retention incentives, in an alleged attempt to make it easier to lure other staffers away with them. The suit claims the pair "were already appropriating for themselves approximately 1/3 of the total Infinity Ward bonus pool each quarter."

"In order to make it unlikely that these employees of Activision’s Infinity Ward studio would remain with Activision, West and Zampella attempted to block those employees from receiving significant equity grants and/or other compensation, suggesting instead that Activision provide the additional compensation to West and Zampella alone, not to the many valued employees to whom Activision was offering this extra compensation."

The suit claims the pair "adamantly refused" to provide the names of employees set to receive bonuses.

$400 Million In Damages

Activision's lawsuit also claims that the conspiracy to lure Infinity Ward employees away from their parent company went to the top of EA's management.

"The unlawful conduct came from the highest levels at Electronic Arts, including EA Chief
Executive Officer, John Riccitiello, and Chief Operating Officer, John Schappert, with direct
support from the high profile talent agency, Creative Artists Agency, and even a former member
of Activision’s Board of Directors and former Activision lawyer," reads the suit.

Activision said it is seeking $400 million in damages from EA, West and Zampella. The publisher said the alleged interference caused a loss of profits, costs incurred from rebuilding Infinity Ward and damages from "delays and disruptions."

The Call of Duty publisher is also seeking a judgment to get back compensation already awarded to the "faithless executives" West and Zampella.

The publisher exhibited new documented evidence in the complaint regarding a business meet-up between EA and the two executives from EA's own records, and files from talent agents and attorneys.

For example, Activision is claiming that "On August 28, 2009, Electronic Arts dispatched a private jet to fly West and Zampella from Southern California to San Francisco where they were picked up and shuttled to a secret meeting with Electronic Arts at Riccitiello’s home and then flown back to Los Angeles."

Activision said the motivation behind EA's alleged dealings with West and Zampella was to "disrupt and destroy Infinity Ward," a studio that is EA's biggest competitor in the popular first-person shooter genre. EA's FPS series include Battlefield and Medal of Honor, which do not approach the sales of recent Call of Duty entries.

West and Zampella eventually went on to found Respawn Entertainment with several former Infinity Ward employees. Respawn then signed a publishing deal with EA Partners.

The core of the allegation from Activision is that "the negotiations between Electronic Arts and West and Zampella were structured with the design and the expectation that West and Zampella would “spin out” from Activision and would take significant numbers of key Infinity Ward employees with them to set up their own independent company."

This was done " that Electronic Arts could make another run at competing with Activision. Electronic Arts would finance the illicitly-created start-up in exchange for an ownership interest or exclusive distribution rights to the content created by their new company, which would produce video games for Electronic Arts instead of Activision."

The suit further alleges that EA was not just interested in gaining the Infinity Ward talent, but it also wanted to use West and Zampella's Call of Duty knowledge to bolster the prospects for its Medal of Honor, in a "blatant attempt to gain an unfair advantage."

"Crush And Destroy" Treyarch?

Another part of the Activision lawsuit dealing with West and Zampella's allegedly untenable behavior touches on the tension between developer Treyarch, which created Call Of Duty: Black Ops for this holiday season, and franchise originator Infinity Ward. As the Activision suit claims:

"On the same day that Treyarch released a video trailer promoting a follow-on product " a “map” pack or “downloadable content” " designed for players of Treyarch’s game Call of Duty: World at War, West and Zampella released a marketing video for Modern Warfare 2 with the purpose of hurting Treyarch’s and Activision’s marketing efforts.

"Far from being remorseful, West attempted to justify his actions on the grounds that Treyarch had insufficiently coordinated with Infinity Ward by stating: “We released on the same day as you because we had no clue you were releasing anything. We are not happy about it.” The real truth, however, was revealed by a series of text messages between West and an Infinity Ward employee contemporaneous with the video trailers’ release.

"The employee texted West that “treyarch released their mp dlc video.” West responded: “Super nice? We release our video? Crush and destroy with our video.” The employee answered: “We already did. And . . . we already did.” West’s following comment: “Nice.” Thus, West’s own words reveal his intentional strategy to “crush and destroy” his fellow developers at Treyarch."

"JR Cooks A Mean BBQ"

The lawsuit also names the Creative Artists Agency, which represents West, Zampella and other industry talent, such as Will Wright. It alleges that members of the CAA "had been attempting to ingratiate themselves as participants in the video game industry", and eager to work work with the Infinity Ward co-founders, pursued them.

The suit claims that the CAA's Seamus Blackley, at the encouragement of EA CEO John Riccitiello, sent emails to Zampella suggesting they should discuss "an amazing thing", and that "JR cooks a mean BBQ," where "JR" is intended to refer to the EA CEO's initials and common nickname. "I think we could accomplish some interesting chaos," it says in what the suit alleges to be an email from Blackley to Zampella.

Further, the suit names "Gang Tyre", or law firm Gang, Tyre, Ramer & Brown, which Blackley is accused of advising to represent Zampella and West in the alleged "secret" negotiations with the CAA and EA. The individual specifically involved is allegedly one Harold Brown, of whom the suit claims: "Brown had served as an Activision board member and advisor, and in that capacity Brown was privy to numerous confidential compensation documents detailing Activision’s confidential compensation and reward practices."

A major point in the suit is the allegation that the accused worked with Brown specifically to, as the suit says, "cloak the illegal negotiations that ensued among them with the secrecy they presumed would be provided by the attorney-client privilege." He is also noted to be allegedly the former classmate of an EA executive whose name was redacted from the legal documents.

[UPDATE: Added EA response, additional quotes from lawsuit.]

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