Statement from CGL regarding financial situation, Addressing the rumors Options

[JM Hardy]

The following was just posted to CGL's website, and I was asked to disseminate it far and wide:

>>>>>
Catalyst Game Labs recently completed a detailed financial review of the company. We learned that over the past several years the company has achieved dramatic growth in terms of demand, increased total revenues and strong sales with an increasing market share in the gaming industry, despite a lackluster economy. We are thrilled by that news and are eager to move forward with our upcoming original game Leviathans, along with our other new casual games. We also remain committed to plans for our beloved licensed games: Shadowrun, BattleTech, Eclipse Phase, and CthuluTech.

While we wish the review had only uncovered positive news, we also discovered our accounting procedures had not been updated as the company continued to grow. The result was that business funds had been co-mingled with the personal funds of one of the owners. We believe the missing funds were the result of bad habits that began alongside the creation of the company, which was initially a small hobby group. Upon further investigation, in which the owner has willingly participated, the owner in question now owes the company a significant balance and is working to help rectify the situation.

The current group of owners was presented with this information on Monday. Administrative organization for the company is under review, and accounting procedures have been restructured, to correct the situation and provide more stringent oversight. We feel the management team at Catalyst did the responsible thing by seeking this financial review and we will continue to restructure as needed. We are in discussions with our partners and freelancers to remedy any back payments that may also be due as a result of this review.

We are embarrassed that this situation did occur but we hope our eagerness to make these changes, along with our reputation for making great games, will encourage you to stand by us. We understand that for a few employees the news was too stressful and we wish them all the best in their new endeavors. However, the majority of the team remains and will continue to bring great entertainment to you all. We appreciate the support our friends, freelancers, and fans have provided us in the past and look forward to a successful future.
>>>>>>

While I don't imagine this answers all questions people may have, I hope this sheds some light on the situation, particularly Catalyst's determination to continue producing products and to remedy back payments to freelancers. I remain open to questions people may have.

Jason H.

[Semerkhet]

Unless the "owner" in question is very wealthy, you'd think they'd notice hundreds of thousands of dollars in extra "co-mingled" income. That or fire your accountant stat.

[tweak]

Unless the "owner" in question is very wealthy, you'd think they'd notice hundreds of thousands of dollars in extra "co-mingled" income. That or fire your accountant stat.

This is when you bring in the lawyers and lose a lot of money in attorney fees.

[LurkerOutThere]

Thanks for the update Jason. I for one have been very happy with CGL and wish them best of luck, as long as you guys put out good products i'll keep buying.

[Prime Mover]

Wow computer died and been out touch mostly for few weeks. Finally back online and log in to spot whats up with Catalyst. Sad to see so many good people leaving but I hope things can work out for the sake of our game.

[Warlordtheft]

So when will the free lancers that are owed money get paid? (Stupid question, but figured I'd ask anyway)

[JM Hardy]

Freelancers are supposed to be getting statements shortly that would set out what they are owed and, from what I have heard, establish a payment schedule.

Jason H.

[Thanee]

...particularly Catalyst's determination to continue producing products and to remedy back payments to freelancers.

I sure hope you will make it thru this mess and continue the way you did before (and the Freelancers will get paid for their hard work, too).

You did a really great job with the game lines. (IMG:style_emoticons/default/smile.gif)

Bye
Thanee

[nezumi]

I don't understand. The company is voluntarily disclosing this information? As in, without prompting, admitting fault and accepting responsibility?

They must be hiding something...

[Delarn]

That owner should sell stuff he owns to give back to his company. Or hypotheque his life for the company ... Anyone up for the run (IMG:style_emoticons/default/wink.gif) (Kidding)

[Rotbart van Dain...]

I don't understand. The company is voluntarily disclosing this information? As in, without prompting, admitting fault and accepting responsibility?

If, by "voluntarily" and "without prompting" you mean "trying to put a positive spin on a potentially disastrous leak fueling the rumor-mill", then yes.

[The Jake]

Does this mean I will be able to buy my hardcopy of Vice at my local game store? *sniff*

- J.

[BishopMcQ]

[Redacted]

[TheWanderingJewe...]

I have a copy of Vice. rather nice it is yes

[toturi]

Funny how Vice pops up in thread that deals with CGL's financial situation.

[Ayeohx]

We understand that for a few employees the news was too stressful and we wish them all the best in their new endeavors.

Sounds like some people got screwed over. Who'd we loose?

[Cthulhudreams]

This is when you bring in the lawyers and lose a lot of money in attorney fees.

Lots of small business owners use personal accounts (which is dumb) to conduct business out of. It's only a problem when you cannot cough up the money - then you are stuffed.

[Thanee]

Who'd we loose?

http://adamjury.com/2010/no-longer-with-catalyst/

Bye
Thanee

[Tachi]

http://adamjury.com/2010/no-longer-with-catalyst/

Bye
Thanee

That BLOWS. It's hard to imagine a current SR book that doesn't have his name in the credits.

[Kool Kat]

The Kat takes an extended vacation from the Shadows and I come back to a whole heap of money sling'n, or lack there of, going on in the corporate belly of the beast. I hope they can repair the damage done and keep my Shadowrunners in business for years to come.

[Orcus Blackweath...]

Hmmm I would suggest hiring a group of shadowrunners to take his thieving ass out, but sadly we can't do that yet.

[Jaid]

edit: link to where i got this information.

tiger eyes (Jennifer Harding, was financial person... unsure of exact title), Adam Jury (layout guy, probably did half or more of everything else too), and an unnamed operations manager.

[BishopMcQ]

The list of staff members who have resigned is:
Jennifer Harding, Bookkeeper and Office manager
Adam Jury, Lead Layout
David Stansel-Garner, Operations Director

Please forgive my previous error, I have redacted my comment.

[knasser]

And do we have a running total of which freelancers have given serious consideration to never working with CGL again? Seems to be a few of them and other than Adam's ever-stirling work, most the Shadowrun material has come from freelancers, has it not?

K.

[BishopMcQ]

I do not have that information, and believe that it is a very subjective discussion for each individual.

[Ancient History]

And do we have a running total of which freelancers have given serious consideration to never working with CGL again? Seems to be a few of them and other than Adam's ever-stirling work, most the Shadowrun material has come from freelancers, has it not?

K.

All writing for Shadowrun is done on a freelance basis. Jennifer Harding, for example, was also a freelancer on current and forthcoming books like Vice, Corp Guide and The Sixth World Almanac. Several freelancers of long-standing have expressed their displeasure at the news of CGL's financial mismanagement, particularly in regards to its direct impact on them (i.e. the chronic delays in payment) and CGL's ability to maintain the line in the future. I can't speak for any of them as regards to whether they will ever work for CGL ever again, but right now lots of people are holding out just to see CGL hold up their end of the contracts.

[Stahlseele]

What about you AH?
Where do you stand in all of this?

[Ancient History]

Unhappy. I don't care for this situation or CGL's handling of it, and some of the most vocal freelancers who have left or stated their intentions to withdraw from their contracts are my friends. There are a couple details of my own situation which make it harder for me to just pack up and leave; right now I'm continuing with my current contracts while waiting for CGL to either resolve the situation (by holding up its end of the freelancer contracts) or implode (when/if they lose the license).

[Stahlseele]

Well, good luck to you too then.
I hope this plays out OK for all of you.

[Aaron]

And do we have a running total of which freelancers have given serious consideration to never working with CGL again? Seems to be a few of them and other than Adam's ever-stirling work, most the Shadowrun material has come from freelancers, has it not?

Professionals don't kiss and tell. Unless we get burned.

[Stahlseele]

And do we have a running total of which freelancers have given serious consideration to never working with CGL again? Seems to be a few of them and other than Adam's ever-stirling work, most the Shadowrun material has come from freelancers, has it not?

K.

Take a look into the other thread Khadim.
All who have rank and name and have quit are in there i think.

[JM Hardy]

Okay, management has issued another statement to address some books being pulled (which was originally reported by ICV2.com, which explains the header of the statement. The statement in its entirety follows.

>>>
In Response To ICV2.com’s News Item, 03/19/2010 09:34pm

ICV2 is a great website that rapidly compiles information across the width and breadth of the gaming industry, as it occurs, and tries to provide a single source for all such news. However, there recent report contained some factual inaccuracies.

First, there has been no halt to sales of any CthulhuTech products. We’re are in negotiations with our friends at WildFire for how best to move forward, ensuring this great book line continues to grow. As such, neither Catalyst Game Labs, nor WildFire, have put a stop to any books from being sold.

Second, the stoppage of a small, select list of Shadowrun books has nothing to do with the license for Shadowrun, which Catalyst still holds. Instead, the halt to sales is due to on going negotiations between Catalyst and its freelancers. We’re moving quickly and thoroughly to resolve this situation to mutual satisfaction, so the community can have access to these great Shadowrun books in short order once more.
>>>

As has been my wont, I'll continue hanging around to answer what questions I can.

Jason H.

[Stahlseele]

Good to know. I posted this in the other thread too.

[Thanee]

As has been my wont, I'll continue hanging around to answer what questions I can.

Thanks for that! (IMG:style_emoticons/default/smile.gif)

It's quite reassuring to see that you are confident in moving forward and getting things to run stable again. (IMG:style_emoticons/default/smile.gif)

Bye
Thanee

[Ayeohx]

Wow, this sucks. When I heard the news I said to myself "If Adam and Jen are gone then CGL & Shadowrun can kiss my ass." And here we are.

[Adam]

I've said this to a couple fans privately -- the last week has been a nice one for fan mail -- but for the love of, well, Shadowrun: don't stop loving the damned game/universe on account of me no longer working on it!

I still love it, after all.

[Cardul]

I've said this to a couple fans privately -- the last week has been a nice one for fan mail -- but for the love of, well, Shadowrun: don't stop loving the damned game/universe on account of me no longer working on it!

I still love it, after all.

You know...Shadowrun has been around since before Adam did layout on it. Since Jennifer Harding was a writer, and
since before the current crop of freelancers and artists. Really, what is the big deal? People quit for various reasons all the time, and it does not really change the game(much).

[imperialus]

You know...Shadowrun has been around since before Adam did layout on it. Since Jennifer Harding was a writer, and
since before the current crop of freelancers and artists. Really, what is the big deal? People quit for various reasons all the time, and it does not really change the game(much).

Yeah, this... as long as I have players who are willing to pretend to be an elf who shoots people in the face for money I'll keep playing Shadowrun. As long as someone continues to publish books that I find useful in said endeavor then I'll be happy.

[Bull]

I likely should have stepped in earlier, but...

Hey guys. Can we keep this thread clear for announcements and the like. General discussion is down a few threads, in the "CGL Discussion Thread, Part 2".

Thanks.

Bull

[SecGuard]

Er thats up to Part3 now Bull.

[Tiger Eyes]

From CthulhuTech's official press release, which had been printing with Catalyst:

The Next Phase of WildFire, Pt. I

5-April-10

As of 3:21 pm today, Catalyst Game Labs transferred ownership of all remaining CthulhuTech and Poo inventory to WildFire, the legal copyright holder of both properties.

As of January 3rd, 2010, WildFire terminated any and all business relations with Catalyst Game Labs, due primarily to non-payment of royalties, in addition to other contractual breaches.

Since that time, WildFire has been trying to work with Catalyst for that company to pay WildFire the remaining royalties owed. Things have progressed very slowly. In order to relieve a portion of that debt all at once, the best solution for Catalyst Game Labs was to transfer ownership of WildFire inventory to that company.

More changes are expected within the week, and more information will be released as they happen.

[nezumi]

1) WildFire holds the rights to CthulhuTech like Wizkids holds the rights to Shadowrun? i.e. - charge for the license, but don't produce anything of their own?

2) Why was Catalyst trying to sell poo? That sounds unsanitary. (And why does WildFire want it back?)

[SecGuard]

That doesn't sound good for CGL.

[Adam]

1) WildFire holds the rights to CthulhuTech like Wizkids holds the rights to Shadowrun? i.e. - charge for the license, but don't produce anything of their own?

Yes, CT and Poo were produced under license from WildFire, just like Eclipse Phase was produced under license from Posthuman Studios.

[SecGuard]

Yes, CT and Poo were produced under license from WildFire, just like Eclipse Phase was produced under license from Posthuman Studios.

Do we have any imformation on if Posthuman have been paid?

[Stahlseele]

Does not look like it.
Posthuman has quit business relations with IMR because of payment issues.

[nezumi]

I really don't know what poo is. (Well, I do, but I don't think we're talking about the same thing here.)

Do we know how much the cost of the Cthulhutech/poo license was compared to the Shadowrun/Battletech license? Does the loss of one portend the loss of the other?

[Adam]

Posthuman has quit business relations with IMR because of payment issues.

Stahlseele, please don't speak for Posthuman Studios. Posthuman is in the process of severing their arrangement with Catalyst.

[Adam]

I really don't know what poo is. (Well, I do, but I don't think we're talking about the same thing here.)

It's a card game by WildFire, about monkeys flinging Poo at each other. Last monkey that isn't covered wins!

[JM Hardy]

I really don't know what poo is. (Well, I do, but I don't think we're talking about the same thing here.)

Do we know how much the cost of the Cthulhutech/poo license was compared to the Shadowrun/Battletech license? Does the loss of one portend the loss of the other?

These are different issues. CthlhuTech is the intellectual property of WildFire; Catalyst acted as publisher to them. It is not a licensing agreement in the same way that SR and BT are licensed from Topps.

Jason H.

[knasser]

It's a card game by WildFire, about monkeys flinging Poo at each other. Last monkey that isn't covered wins!

I couldn't tell if you were joking or not, so I had to check the website.

Turns out you're not.

[JM Hardy]

There is a press release up on the CGL website about the issue. It's short, so here it is in its entirety:


Catalyst Game Labs Negotiating To Part Ways With WildFire And Posthuman Studios

Catalyst Game Labs is currently engaged in negotiations to end its agreements with WildFire and Posthuman Studios. Once the terms are finalized, Catalyst will no longer publish CthulhuTech or Poo: The Card Game for WildFire, nor will they co develop and publish Eclipse Phase for Posthuman Studios.

“It’s been fantastic to be involved with growing CthulhuTech alongside WildFire, while also launching Posthuman Studios’ Eclipse Phase,” said Randall Bills, Managing Developer. “We love both of these universes and want to seem them grow and flourish. However, in our current situation we need to re-focus on our core brands of BattleTech and Shadowrun, while developing our original games. As such, while we are parting ways with both companies, we’ll be doing everything we can to support WildFire and Posthuman Studios as they assume the full mantle for their game lines.”

Future details surrounding CthulhuTech will be found at www.cthulhutech.com, while future Eclipse Phase details will be found at www.eclipsephase.com.

[Rotbart van Dain...]

As anyone who ever rode an amusement ride will attest: Too much spin will make people puke.

[emouse]

I couldn't tell if you were joking or not, so I had to check the website.

Turns out you're not.

It's even nominated for an Origins award. (IMG:style_emoticons/default/wobble.gif)

[-Nyx-]

I couldn't tell if you were joking or not, so I had to check the website.

Turns out you're not.

CGL got a pre-version on last years GenCon... it was quite funny. (IMG:style_emoticons/default/smile.gif)

[nemafow]

Well at least Eclipse Phase is still going to go ahead one way or another, which I'm happy about.

[Wesley Street]

Me too!

[Belvidere]

I don't understand. The company is voluntarily disclosing this information? As in, without prompting, admitting fault and accepting responsibility?

They must be hiding something...

^Totally agree^

And this is how to spot a Shadowrun player. (IMG:style_emoticons/default/rotfl.gif) If a company is coming out with informations... it must mean they're hiding something!

[krainboltgreene]

It looks like Catalyst Gaming Labs has filed for Chapter 7:

http://ia331218.us.archive.org/3/items/gov....504666.1.0.pdf

[Fuchs]

As I understand it others, among them Wildfire LLC, have filed for Chapter 7, which is involuntary bankruptcy, against IMR.

[Nal0n]

It looks like Catalyst Gaming Labs has filed for Chapter 7:

http://ia331218.us.archive.org/3/items/gov...0467666.1.0.pdf

Unfortunately your link is quite dead.
And afaik they have not done this themselves but they have been filed ... by WildFire LLC and 2 other individuals.

[Mesh]

Chapter 7 Link1 and Link2.

[WinterScale]

The new links seem to confirm that IMR Specifically is filing chapter 7 because (per the links) Jean-Phillippe Sugarbroad, Paul H. Stansel and Wildfire LLC wanting to be paid. This isn't CGL as a whole, and it's a total of just under $60k, which isn't a *huge* sum for a company, but is still fairly significant.

We'll have to see where things go.

[Fuchs]

The new links seem to confirm that IMR Specifically is filing chapter 7 because (per the links) Jean-Phillippe Sugarbroad, Paul H. Stansel and Wildfire LLC wanting to be paid. This isn't CGL as a whole, and it's a total of just under $60k, which isn't a *huge* sum for a company, but is still fairly significant.

We'll have to see where things go.

Again, IMR is not filing anything, it is summoned to court.

[Mesh]

I'm on the hunt for a GM for SR4, but all this intrigue and crime ranging from the company with the license to Shadowrun to its writers to its partners even to the moderators on this forum is inspiring me to start writing a new campaign. 格好良い!

[WinterScale]

Wait, so those 3 entities are petitioning Chapter 7 *for* IMR, involuntarily?

This don't make no sense to me. Glad I'm not a financial dude.

[Ancient History]

WinterScale: They're trying to force IMR to liquidate their assets to pay back their debts. Something IMR would not normally do, because hey, they want to stay in business.

[WinterScale]

Ah. That makes sense. Sucks for IMR, but that's what happens when you don't provide proper oversight of your employees and allow people to go unpaid while others pilfer the coffers.

[SecGuard]

So all in all not good for IMR.

[Warlordtheft]

It appears since the negotiations on April 6th, negotiations with wildfire have gone badly......now the lawyers get involved.

[Mesh]

CGL. What a bunch of dandelion-waving, corp-puffs. If management had any sense, they'd take this time to crack open one of the very books they're trying to sell for a tip: Shadowrun. They should already have a Johnson scoping out teams for runs against their debtors to grab some leverage. "Oh, we have a report that your CEO has been using per diem coverage on prostitutes and blow. Here are the pics our runne... a concerned whistleblower anonymously sent to us. How about dropping the Chapter 7 lawsuit so we can both clean these things up quietly and move forward as partners?" Meanwhile, Team2 does a smash and grab on CGL's own turf thinking they're working for a debtor. They clean out a batch of fresh freelance writing (the "paydata" or so they think) and drop a few viruses behind... Viruses that CGL's own spiders wrote to wipe out any trace of the embezzl.... co-mingling. And when they come back for payment? They're actually set up at a meet in a warehouse with all the unpaid freelancers who think they're getting a private meet with Coleman (where they intend to exact vengeance). The scene erupts into a firefight finished off by a rocket through the window courtesy of Team3. CGL laments their losses to the public regaining valuable face and sympathy and vaults back onto their high horse with a much anticipated SR5.

What a wasted opportunity otherwise! It's a shame they don't have any writers left with the creativity to concoct such an "out".

[DireRadiant]

Spamming different threads with repeated posts is against the ToS.

[Mesh]

Spamming different threads with repeated posts is against the ToS.

Looks like the same thread to me (compare titles), and do the Terms of Service specify two posts as spamming?

Like I said when I joined, I have serious reservations about the level of moderating done here.

[WinterScale]

If you've posted the exact same text in another thread, there is no reason to repeat it without specifically mentioning something like "Crossposting this from the other thread because ______" so people know *why*you're putting the same stuff in multiple places.

Otherwise, yes, it can be considered spamming.

Not to mention they aren't the same thread. Similar titles != exact same thread. Heck, that one is a Speculation thread, this one is the actual statements from the company thread. Fact != Speculation either.

[Mesh]

I don't want to hear some overanxious, rules lawyer call two posts to two threads discussing the same subject spamming. If you're looking to abuse your moderator status, then kick me off. You've got plenty of posters who will take that apparently. I'm not one of them.

[Redjack]

If you don't wish to abide by the TOS, then why stay?

[Mesh]

If you don't wish to abide by the TOS, then why stay?

You assume I believe I am not abiding. That is not the case. If the intent of the rule in the ToS is to prevent spammers from posting a message (like an ad for example) on every thread on the boards, throwing it my face for posting a relevant reply in two nearly identical threads is abusive overmoderation.

[Redjack]

We wrote the TOS. Now you are going to tell us what we meant by it? Rich.

[Mesh]

We wrote the TOS. Now you are going to tell us what we meant by it? Rich.

I don't hear you disagreeing. I do hear you sarcastically mocking a new member.

[WinterScale]

Or you know, if you hate the mild moderation that occurs here, maybe you should choose to leave. Jesus dude, take a chill pill. They're nipping a lot of things in the bud of late, because we've had *rampant* violations recently. If you don't like it how our mods do their job, then there are always other forums to visit.

And Mesh, if the mods warn you about a potential violation with colored text, then that is an indication you are *not* abiding by the TOS. They don't just use that text because it makes them feel saucy.

[Bull]

To turn this back on topic a bit... This was just posted to CGL's site.

Catalyst Game Labs Update

While Catalyst has been publically quiet, we’ve been working behind the scenes these last few weeks, reviewing our processes across the board and changing and updating as necessary, while still working on future products.

As announced on March 20th, a select list of Shadowrun books was put on hold as we negotiated with several freelancers concerning those products. We’re pleased to say that within the last three weeks we’ve been able to make 65 payments to dozens of freelancers covering a variety of projects and resolved the hold issues. This process included completely paying off four books already in print while simultaneously auditing past due contracts in order to continue payments on completed projects. We also chose to pay off a book in preparation for sending it to print. We believe that this three-fold approach of resolving the disputed contracts, establishing a payment plan for completed work, and ensuring new product continues down the pipeline is the best recipe for success at this time.

Catalyst has been in negotiations with some additional parties for weeks concerning how to pay down debts, including making partial payments, turning over stock and so on, as they’ve requested. We’ve been notified that some of these parties are pursuing additional legal means to secure the monies owed despite the negotiations. Our legal counsel has advised that the lawsuit is baseless. As such, Catalyst will defend against it and expect it to be dismissed in the near future. Regardless, we’re continuing our negotiations and will continue to move, as we’ve been doing, to pay debts down as quickly as possible.

Finally, as some of you may have noticed, we’ve just changed the legal text and logos on all our appropriate sites that reference Shadowrun and BattleTech from WizKids to The Topps Company, Inc., per their direction. We’ve been in contact with Topps for weeks regarding these situations. We are currently in negotiations to re-secure the Shadowrun and BattleTech licenses.

[Fuchs]

Catalyst has been in negotiations with some additional parties for weeks concerning how to pay down debts, including making partial payments, turning over stock and so on, as they’ve requested. We’ve been notified that some of these parties are pursuing additional legal means to secure the monies owed despite the negotiations. Our legal counsel has advised that the lawsuit is baseless. As such, Catalyst will defend against it and expect it to be dismissed in the near future. Regardless, we’re continuing our negotiations and will continue to move, as we’ve been doing, to pay debts down as quickly as possible.

That's interesting. Turning over stock? Partial payments? "and so on"? That doesn't sound well at all.

[fistandantilus4....]

I don't hear you disagreeing. I do hear you sarcastically mocking a new member.

When a new member comes on to post almost entirely about the style of moderation, we wonder at their intentions. When you go around baiting the mods with snippy comments and little else, you're going to get replys. Of course, you no doubt realize that. Your first post here was to complain about the moderation, which means that you're here to do little else than flame. It would be nice to say that you're concerned with the style and format of Dumpshock, but that would be more believeable if you'd been posting here before. You came here to pick a fight. Don't pretend to be surprised when you're not cordially received.

Argue moderation in the appropriate area.

[Method]

Unstickied in an effort to consolidate overlapping discussions.
Please direct further discussions to CGL Speculation #6

[Mesh]

Mesh

[Method]

This one is drifting off topic anyway, so I'm going to lock it. Please feel free to continue the CGL discussion in the speculation thread. Thanks!