Media company Buzzfeed is suing developer VersusGame for $647 thousand in unpaid invoices, as well as a percentage of the platform’s profits, reports The Daily Beast.
Buzzfeed initially partnered with VersusGame in May 2022. Described as a social prediction platform, VersusGame allows users to play games about entertainment and pop culture, allowing them to compete for cash prizes. The company raised $25 million in June 2022 to further the expansion of its mobile gaming platform, however it appears that Buzzfeed aren’t satisfied that VersusGame has fulfilled its obligations.
According to the court filing, Buzzfeed aims to recover money owed across seven invoices, as well as expenses “it incurred for purposes of the resources it employed once it entered into the Agreement and its legal fees and costs because VersusGame knowingly made misrepresentations of fact and fraudulently induced BuzzFeed to enter into the Agreement.”
Unpacking the case
The court filing alleges that VersusGame offered inaccurate information regarding the monetary benefit Buzzfeed would receive through the partnership. Buzzfeed claims that VersusGame CEO John Vitti falsely stated that it would receive a minimum of $3.6 million per month.
Buzzfeed agreed to provide up to twenty-five questions a week in exchange for a $1000 per question fee, rising to $2000 after the first ninety days, as well as to actively promote the questions across its domain. The company was also due to receive an additional fee of 4-5% of “the gross marketplace value associated with the games played from questions Buzzfeed created with the specific percentage subject to individual game play values.” Although VersusGame appeared satisfied that Buzzfeed had fulfilled its side of the agreement, Buzzfeed was not paid any of the monies due through the partnership.
The suit also alleges that VersusGame violated the doctrine of good faith and fair dealing, having ignored payment requests and attempted to terminate the agreement “for the sole purpose of changing its monetary terms.” These terms would see Buzzfeed receive only a percentage of the earned revenue, without the per-question fee. Buzzfeed refused to accept the new agreement and contacted VersusGame to request payment in an effort to avoid litigation, however the game maker failed to respond to these requests.
At present, no court date has been set for the case.
Earlier this month, mobile gaming giant NetEase was sued by Taiwanese pop star Jay Chou due to allegations of copyright infringement.
