When Deals Go Bad: Kazunoko Faces Uncertain Future
Kazunoko's troubled sponsor misses payments and appears to be dissolving.
Zeveron has reportedly shut down its operations, leaving Ultra Street Fighter IV competitor Ryota “Kazunoko” Inoue’s status in doubt.
As competitive eSports continues to grow, more organizations continue to get involved in the fighting games scene. Zeveron, a relatively new eSports organization, made a splash by signing one of Japan’s top-rated free agent Street Fighter stars Ryota “Kazunoko” Inoue right before Evo 2015. Perhaps seeing a bit of skepticism from the public at the time, Zeveron CEO Jeff Suddarth confirmed on Twitter that Kazunoko was on a one-year contract with a monthly salary and paid travel expenses.
“We are in it for the long haul,” Suddarth said.
Non-payments and Dissolution
Earlier in the week, Zeveron’s Heroes of the Storm team announced via Twitter Zeveron itself had dissolved as a company. The official Zeveron website and Twitter account were taken offline. Zeveron chairman and majority owner Tyler Liberman also posted a tweet on his personal account stating he would no longer be a part of Zeveron, creating even more confusion about the company’s standing.
Speaking with Red Bull eSports, Zeveron CEO Jeff Suddarth confirmed Liberman is attempting to dissolve the company and that none of its players have been paid for the month of July, including Kazunoko who signed with Zeveron shortly before Evo 2015.
According to Suddarth, as majority owner, Liberman was expected to invest in the company in July and funding was allegedly not available until August. Arrangements were made to not pick up new players after Kazunoko, as his first paycheck would have come August 1. The aforementioned contract was drawn up and had a pay-out clause in case any issues, such as the one Zeveron and Kazunoko now face, occur.
By August 3, no payments were made. In documents provided to Red Bull eSports, Liberman assured Suddarth repeatedly the players would be paid.
“I made sure our contracts protected players in case he tried to back out of it,” Suddarth said. “What our contracts say if they aren’t paid a certain amount, they get a minimum at least.”
Red Bull eSports reached out to Liberman for comment and he provided the following statement:
“Kazunoko’s contract was never shared with me at any time, so I was never made aware of the actual structure of the contract besides his expected monthly payment and travel. As I also was not working with him closely like with the Heroes of the Storm team, I have not had any way of communicating with him. I was made aware that Jeff has discussed working with Kazunoko despite the organization dissolving, so I am waiting for any public statements on his behalf before taking any further action regarding it.”
Going forward, what does this mean for Kazunoko? Suddarth was initially unable to reach Kazunoko directly these events unfolded last week, leaving him in a state of confusion.
“I’ve received a lot of messages regarding Zeveron. I am in touch with the person in charge from Zeveron side and we are exchanging info,” Kazunoko said in a series of tweets on August 10. “I will tweet again once all the info is in. Sorry for making you guys worried.”
“I am so thankful for everyone who cheered me up. Thank you very much. All of this happened suddenly last night so I am pretty confused, but it helps me to see the upbeat messages from you guys. Thank you very much.”
Kazunoko would appear on Topanga TV’s live stream on August 11, wearing his Zeveron jersey.
“I talked to Kazunoko the other day,” Suddarth said. “I worked out a deal with God’s Garden to come up with what he’s owed for the end of the month. If I do, we’ll continue to work together on Zeveron and we’ll bring it under me, 100 percent ownership.”
Suddarth described how he and Kazunoko had built a good working relationship. He went to Evo to meet with Kazunoko in person and the partnership between Zeveron and Kazunoko appeared to be a perfect match. Kazunoko proudly showed off Zeveron’s purple and black colors throughout the Evo weekend both at the event and on social media.
Zeveron was set to benefit from Kazunoko’s built-in fanbase, and Kazunoko expected to take the next step in a business partnership that would further both parties brand. His goal was to become the "center of this wave of eSports."
“We still want to work together. He loves the brand and I love working with him. I don’t want him to get screwed.”
Suddarth wants to continue operating under the Zeveron brand. He understands there has been some damage done, but he believes it’s salvageable and the way to do that is to hold up Zeveron’s end of Kazunoko’s contract.
“If Kazunoko gets what he was promised and he’s happy with us. That’s the most important thing,” Suddarth said. “I think that’s the only thing that will make Zeveron stay intact.”
In the meantime, Kazunoko assured Suddarth through text messages that he is willing to wait until at least the end of the August for the payment issues to be sorted. If Suddarth can’t secure Kazunoko’s payment, Kazunoko becomes a free agent.
“At this point in time, if [Kazunoko] really doesn’t want to stick with [Zeveron], he’s welcome to move on,” Suddarth said. “But it sounds like he wants to make it work.”
“I do want to apologize to Kazunoko’s fans that this is happening. I wouldn’t have signed Kazunoko if I didn’t have a legally binding contract. I made sure the players were expected to be taken care of to the fullest of my capabilities. They still are expected to be paid. I hope people realize I’ve done everything I possibly can with this.”
You can read more about Kazunoko and his sponsor Zeveron in our recent conversation from Evo 2015.
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