Factor 5 Founders Caught Up In Wii Rogue Squadron Lawsuit News

A number of former Factor 5 employees have issued a lawsuit against the bankrupt developer, alleging that the company fraudulently transferred assets and intellectual property to another company before filing for bankruptcy to avoid paying wages and its debtors.

The Marin Independent Journal suggests that Factor 5 had between $50,000 and $100,000 in assets, along with $1 million to $10 million in debts including a $4 million loan from LucasArts issued back in 2003.  The bankruptcy filing further includes 69 claims for unpaid wages totalling more than $900,000. 

The new studio allegedly formed by former Factor 5 founders underwent a number of name changes, from Blue Harvest (note the Stars Wars link) to White Harvest.  The article maintains that the transferred intellectual property and assets related to a new Rogue Squadron title for Wii. 

"We allege in the suit that Factor 5 and its three founders fraudulently transferred assets, including source code and other intellectual property to Blue Harvest, which is now known as White Harvest," said James Smith, a San Francisco lawyer representing the employees.

"We believe and have alleged in the complaint that Factor 5 and White Harvest are essentially the same company, being run by the same people, being represented by the same sets of lawyers, with all the same management and ownership and control, performing all the same work that they were doing at Factor 5, just now with a new name and a new address," Smith said.