Thursday, April 07, 2011

TV Tokyo and NAS Force 4Kids To File For Bankruptcy Protection

More news this morning from the Anime Economatrix:

The master licensing and dubbing company 4Kids Entertainment, best known for bringing Pokemon and Yu-Gi-Oh! to the US, filed for Chapter 11 bankruptcy protection (along with 11 affiliated companies) in federal bankruptcy court on Wednesday. The company listed assets of $23,372,000 and liabilities of $16,526,000 and indicated that it expected to have money to disburse to its unsecured creditors.

The company had warned last week that it might have to file Chapter 11 if it was not able to settle litigation with TV Tokyo and NAS, which terminated 4Kids’ rights to Yu-Gi-Oh! and alleged that 4Kids had secretly hidden moneys on which it should have paid the rightsholders royalties. On March 29, 2011 TV Tokyo and Nihon Ad Systems sued 4Kids Entertainment, alleging that the company entered into illegal agreements with other companies, including Funimation Entertainment and Majesco Entertainment, regarding the Yu-Gi-Oh! anime franchise. TV Tokyo claimed that those agreements allowed 4Kids to collect royalties without paying a portion of those royalties to TV Tokyo, which violates their original agreement. The companies are seeking almost $5 million in "underpayments, wrongful deductions, and unmet obligations." As part of the suit, the companies terminated the Yu-Gi-Oh! license from 4Kids.

On March 31, 4Kids Entertainment filed a shareholder report stating that on March 27 they had informed the licensors that their termination letter was "wrongful and devoid of any factual and legal basis," and that they had not given 4Kids 10 days notice as required. 4Kids further revealed that they had made a good-faith payment and agreed to a March 18 meeting in lieu of a lawsuit, which TV Tokyo and NAS nevertheless decided to go ahead with. 4Kids also stated that even if the termination is found to be valid, they are prepared to do whatever it takes to stay in business, and have filed for Chapter 11 bankruptcy protection as of April 6, 2011.

In the bankruptcy filing, 4Kids listed its debts in the filing. The Pokemon Company International was the largest creditr, with $4.7 million owed. Second was Asatsu-DK (parent of NAS), with $4,221,626 owed. Third was CW network, home of 4Kids’ Toonzai programming block on Saturday mornings, with $1,987,000 owed.

4Kids has been loosing money for several years and the New York Stock Exchange delisted 4Kids (NYSE: KDE) stock in June of last year because they could not maintain the minimum capital requirements to trade on the exchange.

Some background on 4Kids controversial 'localization' practices:

The management of 4Kids Entertainment has stated that it seeks to "localize anime so children in English-speaking countries will understand it...", judging that localization is necessary in order for these titles to be profitable. For most titles, the editing 4Kids performs falls into a few broad categories Р4Kids may seek to "Americanize" a program by changing character names, dialog, music, food, or stereotypes which would be unfamiliar or even offensive to an American audience, as in the series, Pokémon, where rice balls are changed into American food such as jelly doughnuts or submarine sandwiches. The company also may remove some materially suggestive objects such as cigarettes or guns with lollipops, water guns, crosses, or content deemed too violent or suggestive for American children. In an interview with Al Kahn, CEO of 4Kids, when asked how the company decides what properties or anime to acquire, his reply was "..if [anime fans] want this programming to come to the United States then they're going to have to accept the fact that it's going to be available in two styles." A March 2006 study by the Parents Television Council on violence in children's television programs said that the 4Kids dub of Shaman King was still too violent for children. L. Brent Bozell also pointed out the 4Kids-dubbed Shaman King in one of his weekly column as an example of children's media he perceived as having undue "cultural landmines".

2 comments:

Draw2much said...

I have never liked 4Kids. No matter how much they say "It's for the children!" I can not like them. The excuses they give are not enough to make up for how they butcher the series they get or the terrible voice acting. (And don't get me started on what I think of censors who encourage them. >_< )

If 4Kids was set on fire, pushed off a cliff, and drowned in the deep blue sea I would be happy. It actually makes me mad that they're still around when other companies who did 10X better then them went under.

UGH.

Sorry for going on like that. I just have very strong feelings about 4Kids. >_<;

jonebender said...

So... 4KIDS had file chapter 11 too ehh. Well there seems to bee a lot of going around these days.Frankly it's a wonder anyone can afford to obtain new titles what with the economy in the toilet,& all that jazz. Anyway regardless of what you,me,&others may think of dis company they did introduce a lot of younger viewers to anime, all be it rather heavily censored to the point of being beyond rediculous. PBS did it much better... well at least in Iowa & surrounding environs with Osamu Tezuka's Princess Knight,& North Carolina with Takahashi Rumiko's Urusei Yatsura. (well they did)