Sonic sued for fraud (Update Jan 11) - Page 6

On December 20 2015 04:05 HornyHerring wrote:
Geez, why does everything have to be shady like that over there?

On December 24 2015 23:18 HolydaKing wrote:

When is a game considered dead anyway? Even WC3 can't be considered dead, it has huge prizemoney tournaments in china even if streams barely pull viewers on twitch.tv

On December 24 2015 08:26 RoninKenshin wrote:
Fraud is wrongful or criminal deception, defined by malicious intent from the beginning in most countries. I don't know Korean law, but there should be no reason for Sonic to stand in front of criminal court for his actions. His company would stand in front of civil court for not upholding his contract, and his company would be responsible for the debt, with the assets of the company being seized for payment, and likely going bankrupt in the process. If he didn't create a corporation, it's possible that he could be responsible for the debt himself, and be forced to declare bankruptcy, with the possible of portions of the debt still following him after that. If he did something like borrow money to manufacture the shoes and then made the shoes but rather spent the money, then that would be fraud and he could possibly see jail time.

The reason why he doesn't have money to pay back the manufacturers is because he spent it all. He suddenly had a huge influx of cash, and decided that SBENU was bigger than it was, and created an insane amount of overhead. He leased very expensive and large stores when he could have just distributed his shoes through any other store. He hired a LOT of A-list (in Korea) celebrities to advertise his shoes, when he should have just either used only one or instagram models or something. I understand hiring one A-list to get SBENU's name out, but anything following that up is redundant, and also just makes the branding confusing. Maybe he just wanted to party with the girls or something.

Finally, for the reason why we love him, he haphazardly sponsored everything Starcraft. Let's be honest here. Every dollar he put into Starcraft probably saw zero return, or a few cents at the most. IU commercials gave him infinitely more relevant exposure than all the Starcraft leagues and tournaments in the world. He sponsored out of love for the game, but he should have really slowed down and done it at a stable pace, not one that assumes initial growth will be constant.

All of these expenses are stupid, but legal and on board. There's no criminal element to them. Obviously he had his splurges: parties and expensive things and an expensive girlfriend. Every company does this though. The problem was the massive monthly overhead that he had (and likely the margins were pretty low looking at the revenue vs profit).

Link 2 : recordings that manufactures revealed. According to this, it was SBENU that sold shoes to warehouses arbitrarily.