TimeGate Studios, the development house behind Section 8 and parts of Aliens: Colonial Marines, filed for Chapter 11 bankruptcy protection in Texas today.
Court documents revealed that TimeGate owes anywhere between $10 million and $50 million dollars to its creditors, which include Gears of War developer Epic Games. TimeGate apparently owes money to at least fifty other companies.
TimeGate is best known for creating the multiplayer FPS Section 8 and its download-only sequel, Section 8: Prejudice. Both games were released to mixed reviews, and TimeGate later sued the game’s publisher, SouthPeak Interactive, accusing them of withholding royalties that they were owed. SouthPeak Interactive turned around and sued TimeGate back, a case which TimeGate eventually lost, costing the company about $7.5 million dollars in damages.
Borderlands developer Gearbox also outsourced part of Aliens: Colonial Marines’s development to TimeGate, and when that game got a less than positive reception from fans and critics alike, TimeGate was forced to let go 25 of its employees earlier this year. The low quality of Colonial Marines is currently the subject of a class action lawsuit.
It’s currently unknown how TimeGate’s bankruptcy will effect the development of their latest title, the free to play third-person shooter Minimum. The game was originally scheduled to launch sometime this year.