Redstone, ex-Midway exec subpoenaed
Former majority shareholder Sumner Redstone and ex-chairwoman Shari Redstone court-ordered to answer questions about $100,000 mystery buyout.
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Bankruptcy is a messy process in the best of cases, but it appears to be particularly ugly for Midway Games. After media mogul Sumner Redstone sold his controlling share in the publisher last December--valued at $30 million--at the bargain-basement price of $100,000, Midway's creditors called in the company's debts to the tune of $240 million.
Unable to secure that much cash, Midway filed for Chapter 11 bankruptcy protection last month. Meanwhile, Midway's debt holders have been vocal with their complaints about the transfer in ownership that started the company's downward spiral in the first place, saying that the suspiciously inexpensive sale price suggests that there was some insider dealing between Redstone and the new majority owner, Mark Thomas.
Now Redstone and his daughter, former Midway chairperson of the board Shari Redstone, have been subpoenaed in the publisher's bankruptcy proceedings. As reported by Game Politics, the company's unsecured creditors are ordering the pair to be deposed later this month. They're also demanding copies of all communications that the pair had with Thomas, as well as documents relating to the sale prepared for National Amusements and Sumco, two companies in which Sumner Redstone has a management stake.
Since the transfer in ownership to Thomas, Midway has seen its chairman of the board step down citing "personal reasons," sold off the distribution rights to its long-in-development Wheelman game starring Vin Diesel, and prepared bonuses should it sell the proverbial farm, its company-defining Mortal Kombat franchise.
Full disclosure: Sumner Redstone is founder and executive chairman of CBS Corporation, owner of CBS Interactive, GameSpot's parent company.