GenCon, LLC files for bankruptcy! | BoardGameGeek Forums

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Subject: GenCon, LLC files for bankruptcy!

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Scott Bartel

(homiefud)

Has anyone heard this yet???!!! I hope it doesn't fold!

Quote:

Gen Con Files for Chapter 11

SEATTLE (February 15, 2008) Gen Con LLC announced today that it has
filed for
Chapter 11 protection in the United States Bankruptcy Court for the
State of Washington.
This action became necessary as a result of significant unforeseen
expenses associated
with attempts to expand its core business to encompass externally
licensed events. Gen
Con's flagship show, Gen Con Indy, remains a vibrant, profitable
event. Gen Con Indy
will take place as scheduled August 14–17, 2008, in Indianapolis,
Indiana.
The protections afforded by Chapter 11 will allow Gen Con to further
its efforts to
address its liquidity needs, preserve value for its creditors and
explore strategic
alternatives for the business. "Because the fundamentals of our
business are strong; and

because our debt problems are challenges mostly linked to one-time
events, we feel
confident that the profile of our company will benefit under Chapter
11 and come out
strong in the end," said Peter D. Adkison, CEO of Gen Con.
Chapter 11 refers to the section of the U.S. Bankruptcy Code that
provides for court-
supervised restructuring of companies as they continue to operate
normally. This
proceeding is intended to help companies to become stronger financially.
Gen Con LLC will continue to operate without interruption during this
process and looks
forward to an expeditious resolution to the short-term challenges and
the ability to focus
entirely on producing Gen Con Indy, The Best Four Days in Gaming.
International Gen

Con events are unaffected by this situation and will continue to
operate as scheduled.

About Gen Con

Gen Con, LLC produces the largest consumer fantasy, sci-fi and
adventure game
convention in North America. Its operations include Gen Con Indy and
licensees for
European and Asia Pacific Gen Con shows. It was acquired in 2002 by
former CEO and
founder of Wizards of the Coast Peter Adkison, who solely owns the company
headquartered in Seattle, Washington. Gen Con is a consumer and trade
experience
dedicated to gaming culture and community. For more information visit
the website at

Media Contact:
Stacia Kirby (206) 363-1492
stacia@speakeasy. net

Posted Sat Feb 16,2008 05:47 pm

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Lucas Kenall

(lukerk)

As big as GenCon (Indy) is, I can't imagine that the show will not go on. The demand is too high. I'm certain there would be an individual or group that could bail them out, if needed, but it sounds like Peter has a handle on things. Seeing this is the most profitable part of Gen Con LLC, I doubt we will ever notice anything.

Posted Sat Feb 16,2008 06:06 pm

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Tim Harrison

(GamesOnTheBrain)

I may be thinking of a different event, but didn't a major game convention (this one?) just get sued by LucasFilm for failing to turn over funds from an official Star Wars fundraiser of some sort?

Posted Sat Feb 16,2008 06:22 pm

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Walt Mulder

(Walt Mulder)

That was Gen Con. Interesting they file Chapter 11 right after getting hit by the suit. Let the speculation begin.

Quote:
Lucasfilm Ltd. has filed suit against Gen Con, claiming that funds raised during an auction the Star Wars Celebration IV in May 2007 – approximately $150,000 – have not been turned over to Lucasfilm or to the Make-a-Wish Foundation.

Posted Sat Feb 16,2008 06:28 pm

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Jeff Wolfe

(jeffwolfe)

The suit was actually for $650,000 plus damages and expenses. In addition to the Make-a-Wish fundraiser, they asked for $500,000 for the event itself. And it was an event on the west coast, not Gen Con Indy.

Posted Sat Feb 16,2008 06:31 pm

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Needle

(nnf1)

That's what happens when your marketing is based on booth babes.

Posted Sat Feb 16,2008 07:46 pm

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Michael Snedeker

(board_games_reno)

And lord knows, Lucasfilnm needs the money!! robot

Posted Sat Feb 16,2008 08:49 pm

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Andrew Gross

(andrewgr)

I would feel more comfortable about this if their website wasn't down.

If, contrary to the press release, Gencon Indy is cancelled, it would really suck on many levels, not least of which is that I've already purchased my plane tickets. :-(

Posted Sat Feb 16,2008 09:01 pm

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Richard Keiser

(darthhugo)

A contract is a contract, regardless of the depth of the pockets in which the money is lining. Rule of law and business 101.. without it, were all screwd.

Posted Sat Feb 16,2008 09:02 pm

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Nathan Collins

(dontadow)

jgerman wrote:

nnf1 wrote:

That's what happens when your marketing is based on booth babes.

That's what happens when your marketing is based on not enough booth babes.

I've been around the business world for a long time. This is what every company that files for bankrupcy says. I've never heard anyone say
"we're going under abandon ship".

You got to make sure your employees don't leave you and your customer base doesn't leave you. This is what Kmart did (now owned by sears), Northwest did (now merging ~~being bought out~~ by delta) and what dozens of other companies that are history have done.

This really sucks, and is a blackeye on the industry. Too much expansion, too little improvement to the core business and too many employees for one con. It was as if they created the other cons to support a con throwing business.

What I really can't believe is that Gencon didn't just donate the money. I can't believe that a company that big for that many years does not have that much cash on hand. (the original 150k). You have to think Lucas tried to settle this for a while.

Last edited on 2008-02-16 16:01:51 CST (Total Number of Edits: 1)

Posted Sat Feb 16,2008 09:52 pm

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(generalpf)

I'm trying to imagine how this will affect me, but for the life of me, I can't.

Posted Sat Feb 16,2008 10:05 pm

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(kuocal)

Unless I read it wrong it sounds to me like GenCon is trying to squirrel its way out of ponying up money it RAISED FOR CHARITY. they can burn in hell if thats the case.

Posted Sat Feb 16,2008 10:10 pm

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Andrew Gross

(andrewgr)

kuocal wrote:

Unless I read it wrong it sounds to me like GenCon is trying to squirrel its way out of ponying up money it RAISED FOR CHARITY. they can burn in hell if thats the case.

I would be very surprised if that turned out to be the case.

It's very tough for the Gencon folks, because I'm positive their lawyers have advised them not to say anything more in public. So they're going to have to endure a lot of mud being slung their way, and a lot of ugly speculation, without defending themselves.

I think a more likely explanation is that they were supposed to pay Lucas a fixed amount of money for the rights to the Star Wars celebration, and had some arrangements based on receipts and profits, and also had an auction; and that they wound up losing a bunch of money on the convention, and simply didn't have the cash to pay everyone they owed-- the charity being in that group of people owed money, but not the only one.

Peter Adkinson has said on the Gencon forums that the purpose of filing for Chapter 11 at this time is to work out a payment plan so that they can pay everyone what they owe them. It's much better for the charities to get all the money coming to them over a period of several years, as opposed to getting pennies on the dollar now as Gencon LLC is sued out of business. It's not like they have hard assets you can sieze and sell to get the money up front: they make a profit every year by putting on Gencon Indy, and that's where the proceeds to pay their debts will need to come from.

I don't have any inside information, and could certainly be wrong about this interpretation, but I do think it's more likely than Peter trying to screw a charity out of their money whilst continuing to run a profit-generating convention every year.

Posted Sat Feb 16,2008 10:24 pm