Viacom Owes Harmonix Stakeholders $383 Million

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According to a filing with the Securities and Exchange Commission from the end of December, Viacom is going to have to pay the former shareholders of Harmonix Music Systems a buttload of cash, and yes, "buttload" is a technical financial term. When music games like Harmonix's Rock Band stopped being insanely profitable, Viacom decided to dump Harmonix and demanded that former Harmonix shareholders return most of the $150 million in performance bonuses that it paid out. The former Harmonix stakeholders then demanded another $700 million of performance bonuses, arguing that this was owed to Harmonix under the acquisition agreement because Viacom had engaged in financial shenanigans (another technical term) that resulted in underpayments to Harmonix stakeholders. Resolution accountants (arbitrators with accounting expertise) determined that Viacom owed Harmonix stakeholders an additional $383 million. Unhappy with the result Viacom has filed a lawsuit to require the resolution accountants to consider additional evidence and revise their determination. So, Viacom might not owe the full $383, but odds are good that they will. Filing suit after going to arbitration is rarely more than a delaying tactic. Remember, Viacom saves a lot of money if can merely delay that substantial payment.

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This page contains a single entry by Editor published on January 4, 2012 8:44 PM.

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