Atari, Edmondson Settle Reflections Unfair Dismissal Claims

Trouble publisher Atari, which revealed yesterday that it had settled the controversial American Video Graphics patent lawsuit at a cost of $300,000, also revealed, in the same filing, details of a settlement made by Reflections founder Martin Edmondson, who resigned as head of the Driver franchise creator and Atari subsidiary in December 2004. The settlement follows a claim for unfair dismissal in the UK courts, and ended up in a significant payout of over $4 million, including $2 million in shares, to Edmondson. The filing specifically reveals that Edmondson filed a Notice of Claim with the Newcastle upon Tyne Employment Tribunal in March 2005 "claiming constructive unfair dismissal as a result of Reflections alleged repudiatory breach of a contract of employment that necessitated Mr. Edmondson’s resignation." Atari's statement continues by explaining: "The parties have concluded a negotiation process with Mr. Edmondson whereby Mr. Edmondson agreed to withdraw his claims against us in return for a settlement payment. Mr. Edmondson signed the Compromise Agreement on August 9, 2005 and the Agreement was executed by us and Reflections on August 12, 2005. Mr. Edmondson has now withdrawn his claim and the Employment Tribunal dismissed the claim on September 15, 2005." Elsewhere in the document, the specifics of the payment, if not the nature of the disagreement, are made clear: "On August 31, 2005, pursuant to a Compromise Agreement executed on August 12, 2005 between us, Reflections Interactive Limited (“Reflections”), our wholly-owned subsidiary, and Martin Lee Edmondson, a former employee of Reflections, we issued 1,557,668 shares to Mr. Edmondson as part of the full and final settlement of a dismissal claim and any and all other claims that Mr. Edmondson had or may have had against us and Reflections. The share issuance was valued at $2.1 million." In addition: "The Compromise Agreement also included a cash payment of $2.2 million paid in twelve equal installments beginning on September 1, 2005, as well as a one time payment of $0.4 million payable on September 1, 2005", leading to a significant payout for Edmondson. Edmondson himself founded Reflections back in 1984. The firm was particularly known for graphically stunning Amiga title Shadow Of The Beast in its early years, before moving on to Stuntman and the Driver series. Though still selling through in some numbers, Driver 3 was a significant critical and sales disappointment for Atari and parent company Infogrames, possibly leading to Edmondson's stormier relationship with his developer's owners, although no specifics of the disagreement between the parties has been revealed.