Def Jam Rapstar co-publishers Konami and Autumn Games have been sued by City National Bank for allegedly failing to repay a single penny of a $14 million loan taken out for the game.
According to Courthouse News, City National claims the companies lied to secure the loan by assuring the bank that revenue from sales of the title would cover it. Konami and Autumn reportedly made "baseless and unrealistic projections" that Def Jam Rapstar would ship 2.5 million copies in its first year.
"CNB has recently learned that defendants' representations concerning financial conditions and repayment of the loan - both before and after the loan was approved - were false at the time they were made and that defendants never had any intention of repaying the loan as promised," the complaint reads.
"Rather than paying game-related proceeds directly to CNB as agreed, defendant have kept all game-related proceeds for themselves and have refused to remit any such proceeds to CNB.
"By the time CNB learned the true state of affairs, Autumn had drawn down $13,987,003.15 of the $15 million line of credit," the complaint continues. "To date, defendants still have not paid CNB a single penny of the principal amount that is due, and they continue to insist that none of the proceeds from sales of the game are owed to CNB and/or available for repayment."
City National Bank is seeking more than $8.9 million in damages for fraud, negligent misrepresentation, breach of contract, breach of covenant of good faith and fair dealing, money had and received, unjust enrichment, recovery of personal property, and punitive damages.