Skybound Games has been sued, accused of engaging in years of financial fraud
Skybound Games is the gaming division of Skybound Entertainment, the company that owns the rights to "The Walking Dead" universe. As reported by Engadget, it recently faced a lawsuit from publisher iam8bit.
Stray
In the complaint, iam8bit stated that in 2021, it formed a partnership with Skybound Games, under which they agreed to jointly release physical versions of indie games. For example, the companies released Cuphead, Escape Academy, and the Ori duology on discs and cartridges.
According to the terms of the partnership, the publisher claims, Skybound Games was supposed to send it financial reports monthly but regularly neglected this obligation. When reports were sent, they allegedly included fake expense items. According to iam8bit, over four years, Skybound Games inflated its expenses "by millions of dollars," resulting in a loss of profit for iam8bit.
Additionally, iam8bit stated in the lawsuit that Skybound Games interfered with its deal with Annapurna Interactive to publish Stray, preventing it from releasing the game on Nintendo Switch. Moreover, during negotiations, the company allegedly used confidential information about iam8bit's royalty entitlements and displayed promotional materials that were "almost exact copies" of those created by iam8bit for the PlayStation version of Stray.
Now, iam8bit wants the court to compel Skybound Games to pay more than $4 million in compensation. Skybound Games has not yet commented on the lawsuit.