THQ Being Sued By Adidas For 10 Million
After a lengthy circus surrounding their recent spate of layoffs and division closures, THQ has enjoyed a relatively quiet few weeks. Alas, the circus has just returned to town, and it’s wearing an expensive pair of shell toes; Athletic shoe manufacturer and Run DMC brand partner Adidas is now suing THQ in Oregon courts.
At issue is a contract signed in 2010 in which THQ agreed to create and release a personal training game called MiCoach, which would have been linked to some of Adidas’ electronic devices, by 2012. THQ was unable to complete the game within that time frame. Their Q3 investor call confirmed their intent to shrink the size of the company considerably, focusing on “core games”. Several THQ divisions were closed and their projects cancelled, including MiCoach. Adidas, alleging breach of contract, is demanding 10 million dollars in damages and lost revenues.
This is unlikely to further interrupt the progress of THQ’s upcoming games, but it’s a bad sign for the company after a brutal 2011. By February, 2012, THQ had laid off 250 employees, closed several subsidiaries, and slashed its CEO’s pay by 50%. THQ is currently fighting the suit; the question of whether or not other former partners will follow Adidas’ lead remains unanswered, but THQ is undoubtedly preparing for the worst.