Shrapnel’s ‘Neon Machine’ files lawsuit over hostile takeover

By Crypto Gloom On Nov 30, 2023

Shrapnel’s game studio, Neon Machine, has filed a massive lawsuit. At the heart of the conflict is an alleged hostile takeover by 4D Factory CEO Cort Javarone, who is under investigation for ousting the company’s largest shareholder and CEO, Mark Long.

To make matters worse, Javarone is reportedly refusing to disclose his stake to additional stakeholders, the most common move to maintain a controlling stake in a company. Investors who lost money include those who invested $20 million in Shrapnel last month, such as Griffin Gaming Partners and Polychain Capital.

Remaining positive during this chaotic moment, Shrapnel pledged his commitment to releasing early gameplay access as usual in the coming weeks.

🙌 pic.twitter.com/ep2rfnkeHG

— SHRAPNEL 🔺 (@playSHRAPNEL) November 28, 2023

Neon Machine Litigation Investigation

On November 13, Javarone appointed himself CEO of Neon Machine, reportedly removing the previous CEO from the studio’s board of directors. affirm and his continued CEO status at Twitter).

Javarone was rumored to have bought the studio to pay off $45 million in debt. In particular, he is known to have filed for Chapter 5 bankruptcy for his company.

In an attempt to regain control of the studio, Neon Machine’s founders – CTO Don Norby, CCO Colin Foran, COO Aaron Nonis, CMO Mark Yeend, head of business development Naomi Lackaff and “former” CEO Mark Long – filed suit in a Delaware court. Supreme Court yesterday.

The legal filing appears to name other individuals along with Javarone as defendants, including 4D investor Steve Horowitz and Scott Honor of private equity firm Northern Pacific Group. These investors are acting to retain majority control of the board, potentially exposing the company to tens of millions of dollars worth of debt, according to the sources.

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