Section 8 developer files for bankruptcy protection

Section 8 developer and Aliens: Colonial Marines co-developer has filed for Chapter 11 bankruptcy protection, citing various debts to companies like Epic Games and SouthPeak Interactive.

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TimeGate Studios, the developer behind Section 8 and co-developer of Aliens: Colonial Marines, has filed for Chapter 11 bankruptcy protection. The petition, filed in the Texas Southern Bankruptcy Court yesterday, lists less than 50 creditors owed money from TimeGate.

Polygon reports that the list of chief creditors includes Unreal Engine developer Epic Games, Section 8 publisher Southpeak Interactive, Agora Games, and DJ2 Entertainment. The amounts run the gamut, from a local pizzaria ($34.80) and video game agency ($20,539.20), to much larger amounts ranging from $10 million to $50 million.

TimeGate and SouthPeak have been locked in a legal struggle since 2009. TimeGate filed suit against the publisher in 2009, claiming withheld royalties and that it failed to localize Section 8. SouthPeak subsequently counter-sued saying TimeGate hadn't put enough of its own funds into the game. When they entered arbitration, a third party awarded SouthPeak $7.35 million. That was successfully overturned, but then in April a court reinstated the ruling.

On top of the difficulties with SouthPeak and Section 8, TimeGate has been facing scrutiny for its part in Aliens: Colonial Marines. After the game received a poor reception, purported insiders made differing claims as to how Gearbox and TimeGate divided the labor. The developer suffered layoffs shortly after. Just a few days ago, a lawsuit was filed against Gearbox and Sega for false advertising related to Colonial Marines, but TimeGate was not reportedly included in that suit.

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  • reply
    May 2, 2013 12:30 PM

    Steve Watts posted a new article, Section 8 developer files for bankruptcy protection.

    Section 8 developer and Aliens: Colonial Marines co-developer has filed for Chapter 11 bankruptcy protection, citing various debts to companies like Epic Games and SouthPeak Interactive.

    • reply
      May 2, 2013 1:10 PM

      They really shouldn't be included in the class action; they had nothing to do with the marketing.

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      May 2, 2013 1:33 PM

      Section 8 was an awesome game that no one played :(

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        May 2, 2013 2:31 PM

        Played for about an hour and hated it :(

        Don't even remember what my complaints were with it, but I just remember not liking a single aspect of it.

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      May 2, 2013 2:38 PM

      I will always know them as the makers of Kohan. Wish they'd bring the series back. :(

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      May 3, 2013 12:14 AM

      I thought it would be chapter 7, oh well close enough

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