Riot Games, the video game company best known for being behind the game League of Legends, has filed a petition in Delaware bankruptcy court to terminate its exclusive agreement with FTX. According to available information, FTX will owe Riot Games $10 million as of January 2023, an amount that is expected to increase over time.
Riot Games tainted by FTX
Riot Games, the company behind League of Legendsone of the most popular video games in the world, wants to end its partnership with the bankrupt company FTX.
Said partnership, established in August 2021, was to be spread over a period of 7 years and was to allow FTX display their brand during the League of Legends Championship Series (LCS) in North America. Thus, FTX had secured a prominent place to promote its services, with the company enjoying exclusive crypto sponsor status with Riot Games.
Also, according to the document filed last Friday with the Delaware bankruptcy court by Riot Games, the video game company says it suffered “serious reputational damage”, in particular insofar as the sponsor was completely public. and had been relayed by various leading media.
Riot Games has also declared itself financially impacted by the various media spin-offs :
“Since the FTX public debacle, Riot has suffered significant non-monetary and monetary damages due to its continued association with FTX. […] The deal with FTX represents the largest sponsorship deal Riot has ever signed for an esports league. […] . Before and during this media storm, Riot’s image and reputation with its customer base remained inextricably linked to FTX through its former CEO, Mr. Bankman-Fried. »
Also according to the court document, FTX allegedly failed to pay sums already due in 2022 :
“As noted above, FTX defaulted on its obligation to pay $6.25 million in 2022. […] Indeed, FTX did not even attempt to respond to Riot’s multiple attempts to contact it regarding existing defaults to FTX. »
Also, under the terms of the agreement, FTX still owes tens of millions of dollars to Riot Gamesgiven the duration of the partnership:
“For 2023, FTX owes Riot $12.875 million, which is due on a quarterly basis at the start of each quarter. FTX will therefore owe an additional $3.218 million on the first business day of January 2023. Again, FTX has provided no assurance of its willingness or even ability to pay. Tens of millions of additional dollars will be due under the agreement for the remainder of the agreement term through 2028.”
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SBF known for its affinity with the game League of Legends
Sam Bankman-Fried was known to be a regular League of Legends player, himself having claimed in the past that this was a way to “clear your head”:
8) On League of Legends:
I play a lot more than you’d expect from someone who routinely trades off sleep vs work.
Well, there’s one answer, which is the obvious one. The single most universal thing about LoL is that everyone who plays it says they wish they didn’t.
— SBF (@SBF_FTX) February 4, 2021
An affinity that Riot Games did not fail to mention in its filing last Friday:
“The media and Twitter commentators released footage of Mr. Bankman-Fried playing League of Legends just as FTX crashed. He is well known to investors for playing League of Legends during meetings. »
Team SoloMid (TSM)a central team in the League of Legends game’s American competitions, had also ended its own partnership with FTX in mid-November.
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Source: Delaware Court
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