Ruling gives ‘Stargate’ games back to Cheyenne Mountain receiver, but MGM pulls license

A Maricopa County Superior Court ruling has ended a bitter dispute over control of a Mesa video game company’s assets, effectively giving the online combat game Stargate Resistance (pictured) and the long-delayed online roleplaying game Stargate Worlds back to Cheyenne Mountain Entertainment.

But time may finally have run out for Worlds, Cheyenne Mountain’s signature project: The ruling comes as MGM Studios has apparently terminated the license it granted in 2006 for the Arizona company to produce video games based on the Stargate movies and TV shows.

Last week Judge Edward Burke approved the return of assets to Cheyenne Mountain. He also approved a new receiver for the company, which had filed for Chapter 11 bankruptcy protection, placing the restructuring in the hands of Phoenix’s MCA Financial Group, according to a court document. The substitution is part of a settlement that also approves debt payments and loans to fund continued operations.

The agreement settles a multimillion-dollar fraud complaint brought by Cheyenne Mountain investors against Dark Comet Games and Fresh Start Studios, which were formed by former employees to maintain and expand Stargate Resistance, a third-person shooter released in February. To date, it’s the only product the company has managed to release, and it was rushed to market just days before the company sought court protection from its creditors.

The complaint says Fresh Start tried to remove all of Cheyenne Mountain’s assets from its offices on Feb. 24, almost two weeks after it sought bankruptcy protection — but was prevented from doing so when the police arrived.

According to Cheyenne Mountain chairman and CEO Gary Whiting, the company had filed for bankruptcy to prevent the fraudulent transfer of its assets to Dark Comet and Fresh Start Studios.

I met with Whiting last month at the Mesa offices where Cheyenne Mountain signed the Stargate deal with MGM. They were bare, to put it mildly, with most of the useful equipment and furniture removed. Networking cords had been cut and left to hang loose, and PC cases were empty shells that had been gutted of components such as hard drives. Whiting told me then that the license from MGM would expire this month — and Monday, between sessions of a hearing to wrap up the case, he said MGM had issued a notice of termination on Nov. 3. (That would be the same day MGM officially filed for bankruptcy in New York.)

Whiting has told me that such a termination would not affect Resistance, as that game already has launched and is under a separate license — and he told me Monday that the new receiver is trying to save the Stargate license.

“MGM has been very good to work with us,” Whiting said last month. “We missed several deadlines like that along the way. And I know they’re having their own struggles right now.”

Whiting then expressed optimism that Dark Comet would end up returning Cheyenne Mountain’s assets to him. He compared his situation in the “hostile takeover” to that of Robert Downey Jr.’s Tony Stark in the first Iron Man movie, but said the motives for it were personal and even religious.

“They took everything I owned and they took … besides my personal property they took my good name,” he said. “When I watched Iron Man, that was my life right there on the screen because of what these guys did to me.”

Whiting says that an attempt to fire him in February by Cheyenne Mountain’s then-board of directors provided cover for the takeover of assets. He was later reinstated by the court, but by then Dark Comet had possession of the games.

“All I wanted was a fair shake,” he said. “I founded this company. I’m the brains behind this company. I’m the creative guy behind this company.”

He said Stargate Resistance was being run by “promotional idiots” and that he had a plan to get the backing needed to bring Stargate Worlds to market.

Dark Comet and MGM representatives have not responded to repeated requests for comment via e-mail and phone call.

Meanwhile, a designer who worked on Stargate Worlds recently posted some images from the game to his online portfolio, in the form of collages that combine old and new screenshots with concept artwork. They don’t reveal anything unexpected, but offer just another view of what might have been.