Sega claiming $941,000 from THQ over Company of Heroes 2 preorders

Publisher files motion claiming $941,710.93 over Steam preorders for real-time strategy game after THQ bankruptcy.

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A new filing in the THQ Claims Registry reveals that Sega is seeking $941,710.93 from the bankrupt publisher over Company of Heroes 2 preorders through Valve's online store Steam.

Sega purchased the Company of Heroes franchise--and developer Relic Entertainment--for $26.6 million during the THQ bankruptcy auction in January.

Of the $941,710.93 total, Sega claims $508,877.85 as priority under United States bankruptcy laws 11 U.S.C. § 364 (a), 503 (b)(1)(A), and 507 (a)(2). This figure is derived from preorders made after THQ's official bankruptcy filing on December 19.

Sega's filing in the THQ Claims Registry also includes an itemized statement showing a detailed summary of exact preorder figures through Steam--information neither Sega nor THQ ever released.

According to the document, through January 24, 2013, gamers preordered a total of 20,755 copies of Company of Heroes 2 through Steam. Most popular was the standard edition of the game, moving 14,068 units in all after chargebacks/returns.

A full breakdown is available in the chart below.

Company of Heroes 2 was, of course, not only available through Steam. The game, prior to its launch late last month, was available for preorder at Sega's own online store, GameStop, Amazon, and other major retailers.

The Sega filing also reveals information regarding its revenue sharing contract with Valve-Steam.

Net Steam sales for all 20,755 copies of Company of Heroes 2 reserved through the distribution service totaled $1,345,301.29. The cut Sega claims it is owed--$941,710.93--is 70 percent of the total, meaning Valve-Steam took 30 percent.

Sega is far from the first to lodge a claim against THQ. In the time since THQ went bankrupt last year, the company's creditors at large have claimed hundreds of millions in owed money. A long list of companies like Mattel, Microsoft, Double Fine, and Codemasters, as well as former executives like Jason Rubin and Brian Farrell have all filed claims against the company.

GameSpot has reached out to Sega for additional comment.

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Written By

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.

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Discussion

101 comments
duderdave
duderdave

It is extremely revealing and shocking that Valve-Steam does not seem to follow standard business practices concerning preordered goods.

Standard business practice puts a "hold" on money for preordered goods that is not released until the goods are delivered.

The fact that Valve-Steam would be allowing these money transactions to be finalized and profit taking to occur, well before any possible product delivery, and especially in light of the uncertain circumstances surrounding the THQ insolvency dilemma, demonstrates a shoddy business practices model and a woeful lack of appropriate internal financial controls to protect consumers and game developers.

The money in question should have been isolated in their accounting procedures and only disbursed upon delivery of the actual preordered products to the preordering consumers. Only then should the proceeds have been released to the rightful vendor who actually delivered and supported these products.

Valve-Steam finally got caught with its pants down, and this whale's underbelly was truly not a pretty sight to see.

frostbite2user
frostbite2user

poor THQ they were the greatest but i guess people didn't buy enough of their games, MX vs ATV was legendary until Aive

gorillazzero
gorillazzero

That's why UBISOFT has UPlaye, EA has Origin,  Rockstar has Social hub  etc... 


OldKye
OldKye

This is why you have to keep your files and paperwork in order lol even if your going bankrupt it bites you later.

aesir05
aesir05

so anyone figure out how much of a cut Steam takes off a game yet?

Looks to be around $14-16 per copy sold on Steam which is roughly 25-28% of each AAA sold which is in line with standard retailers cut according to http://latimesblogs.latimes.com/.a/6a00d8341c630a53ef0120a8b7438c970b-600wi


however it seems that even with that the publiisher is saving 4% of the cost that would normally go to distribution/manufacturing and I'm sure its cheaper to advertise on the biggest PC games store in the world than hanging banners in all retail stores

Everiez
Everiez

Damn, if I were one of those preorder then I'd be mad that my money went to creditors instead of Relic and Sega.

sonyfreak456
sonyfreak456

Sega can get more money if they find the companies that are still streaming Dreamcast related material after the discontinuation of the games and Sega net. They can sue them since the companies are using Sega's material without permission.

y3ivan
y3ivan

the ugly truth about pre-order. 

PinchySkree
PinchySkree

Those sales are pathetic.


That's what you get for making a  game no one wanted instead of listening to us.

Paul2004
Paul2004

Thats alot of cash, but will they get any of it :P ?. Since they are bankrupt i can see problems getting any cash from them, even harder considering that they arent the first to try.

thequickshooter
thequickshooter

THAT MUCH? 

but the game sucks next to the original COH, not to mention 60$!!!!! 

who in their right mind agree to this? 60$ for a PC game WTH 

did sega like, change the rules or something?

ArataWata
ArataWata

Stoooop, it's already dead. DX

supermariomelee
supermariomelee

So if I'm understanding this right, Sega claiming THQ owes money from pre-orders?  Essentially, THQ took money from pre-orders for the game, while they were filing for bankruptcy & selling off Relic?  

All the while, Sega buys Relic, then has to honor those pre-orders(even though they didn't receive the money for them).  Meaning it's basically lost revenue.

If that's what that means, that's some pretty shady crap that THQ pulled off.  Hopefully Sega can get the money back.


andrew_ribbons
andrew_ribbons

But really now, Relic worked hard for those preorders.  Their new parent company, and inherantly themselves, definitely deserve the revenue back.  In full.

ahmed74
ahmed74

Yeh well congratz NOW BRING US DREAMCAST 2 WITH SHENMUE 3 AND SONIC ADVENTURE 3 !!!!

Dark_Mits
Dark_Mits

Hold on a sec here; are the majority of posters here cussing Sega for trying to claim something that rightfully belongs to them by both law and logic?

eze_sl89
eze_sl89

i hope sega uses that money to make their next console !!!

not.

JLCrogue
JLCrogue

It must suck to be the owner or one of the shareholders of THQ.

MateykoSlam
MateykoSlam

thats what you get for spending 26 million on shitty franchise


JudgeSim
JudgeSim

go away sega. go die with nintendo.

VenkmanPHD
VenkmanPHD

I am a pretty intelligent individual, but I didn't grasp what the hell is going on here at all.

I'm glad this is all over games I don't care about.

Kisalon
Kisalon

@gorillazzero Finally someone who gets it... and ofc there is also the other reason that those companies dont want Steam to dictate when their games are to be patched ( that was EA's comment anyways )

Battjas
Battjas

@sonyfreak456 

But they wont because they don't want that reputation with their customers. In addition, it's free advertising for the Sega brand since the games and console are discontinued anyway.

MAD_AI
MAD_AI

@PinchySkree  

?

Those are the preorders for the months of September 2012 to January 2013 only, the game has been in the top 10 and top 20 list on Steam since release if not before and Relic said that the launch was very successful. 

And so far the MP has been very populated.

Roccoroll
Roccoroll

@thequickshooter the original COH was fuken awsome, don't be a fuken moron. I agree that the new one added nothing new to the game.

thequickshooter
thequickshooter

oh it's preorder money from before the release while it was still a THQ IP 

man i should read a little more then just the first few sentences 

Dragon_Nexus
Dragon_Nexus

@ahmed74 Sonic Adventure 3 already exists. It's called Sonic 06

And a Dreamcast 2 would fail just as quickly and as thoroughly as the first one did. Especially with Sega as they are now with their crippling fear of money and success.

andrew_ribbons
andrew_ribbons

@Dark_Mits Wooooa nelly!  Now dunna yew be assuming here now fella, that the majority of this...fiiine collective of hulligans defined as Gamesphat....have any fearin concept of law or indeed, common folk logic?  Well holeh smoking grampappehs.


I don't know why the weird accent .v.

LindBergh2007
LindBergh2007

@eze_sl89 They've already spent $400 million on a Tablet console called "Spectrum". SEGA is preparing to stun the gaming world with a string of MAJOR company changes, they've been laying low since E3 and will break their silence in the next week. Sega's new 1st party division is called "Sega Entertainment Corp.Ltd".

ThrashMatt26
ThrashMatt26

@eze_sl89 they already did, it's called the xbox one.
but in all seriousness, look at the design team behind the origjnal xbox, a lot of sega employees.

RobDev
RobDev

@VenkmanPHD one company took pre-order money for a game, went belly up before launch. Second company bought game/developer from company one and now have to supply aforementioned pre-orders to the users without receiving the pre-order money.

LindBergh2007
LindBergh2007

@Battjas @sonyfreak456 Those still making games for Dreamcast are considered the only profit SEGA makes on its name, which is still being protected.

Elann2008
Elann2008

@thequickshooter 

That's what I initially thought as well, but even for pre-orders, that's low.  I'm guessing people are still riding that nostalgia of Company of Heroes 1, which was a fantastic game. 

Somehow, I don't think COH2 is as bad as some people make it out to be.  More COH and some new features isn't bad deal.  Just not at $60 lol.  In my defense, I rarely buy a game for $60 nowadays.  That's a lot of money.  I'll usually wait until it drops down to $30-40.

LindBergh2007
LindBergh2007

@b74kd3th Research. Actually caring. SEGA's 3rd party publishing division will be relegated to "Sega Networks,International".

Elann2008
Elann2008

@b74kd3th 

I wouldn't doubt it, but all I know is... SEGA has many assets and they are well above the red.  And it seems like they are making better decisions about their finances now.