Gamedev Lessons from the $150 Million "Grand Theft Auto" Profit Sharing Dispute

You have to rob a lot of banks and carjack some expensive automobiles to pay off the Grand Theft Auto royalty payments. One of the producers of the Grand Theft Auto series of games claims that he was fired and cut out of his share of $150 million in profits while his partners took the money for themselves.

Take-Two actually filed the first lawsuit against Leslie Benzies for a declaratory judgment but Benzies’ suit really dishes the dirt in the dispute. Benzies grew up in Scotland and programmed his first video game by age 12. Benzies was one of the creators of Grand Theft Auto 3 and was thereafter named president of Rockstar North, the lead development studio for Rockstar Games, and went on to help develop numerous other GTA games including Grand Theft Audio 5. Due to his success, Benzies was named a principal with Sam and Dan Houser and got to share in the lucrative profits from the games under a 2009 agreement. GTA 5 went on, so far, to generate $3 billion in sales.

After the success of GTA 5, the Housers convinced Benzies to take a six month sabbatical to recharge but he was never allowed back and fired. Benzies claims that during this time the Housers allocated $93 million in profits to themselves with another $523 million still accounted for; Benzies was allocated zero dollars during this time. Benzies further claims that he permitted Sam Houser to act as the sole contact and liaison to negotiate the 2009 profit sharing deal and let Houser’s lawyer represent him. Benzies claims he just signed the 800 page agreement that could cut him out of the profits and he claims Houser nor his attorney ever informed him of this.

In the whopping 71 page complaint, Benzies sued the related Rock Star companies, Take-Two and his former partners. Benzies alleges that the Housers breached their fiduciary duty to their partner and numerous other related causes of action. For his damages, Benzies claims he is owed $150 million, chump change.
Oh the lessons to be learned here:

  • Whether Benzies has a case or not, he did sign an agreement that permitted this activity to occur. Don’t just sign a document, especially an 800 page one, without reading it or letting a lawyer review it.
  • If you are partnering up with others, it is best to all hire your own attorney to ensure that each partners’ individual rights are protected.
  • Profit sharing can get complicated, be sure you have accounting rights to review the books.
  • Money is on the line so even if you are close friends with your partners, you have to be careful.
  • The plaintiff hired a huge law firm here that for some reason can’t spell the word “judgment;” there is no “e” people. So those $1,000 an hour big law firm prices are never really worth it.
  • Never take a sabbatical.