Please wait...
Please wait...

4Kids triumphs in Yu-Gi-Oh! lawsuit

US-based children’s firm 4Kids Entertainment has scored a major victory in its court battle with its former Japanese partners on the Yu-Gi-Oh! franchise.

A US bankruptcy court has found in favour of the embattled company for the initial phase of the trial Asatsu-DK (ADK) and TV Tokyo Corp brought against it in March last year.

The plaintiffs alleged 4Kids owed them around US$4.7m in damages over audit claims and terminated a license agreement they had over the popular manga brand. 4Kids subsequently went into Chapter 11 bankruptcy protection in preparation for the case.

But The United States Bankruptcy Court for the Southern District of New York found the Japanese firms had not “effectively” terminated the licensing agreement, meaning it remains in existence and is a property of 4Kids’ bankrupt estate.

Furthermore, the court examined nine audit findings from the plaintiffs totalling more than US$4.8m and found 99% were “meritless”. Two other claims totalling US$47,825.17 were not disputed and have been offset by a US$1.8m credit balance in place when the agreement was terminated on March 24 last year.

The court also questioned the Japanese firms’ “good faith” and dismissed breach of trust allegations, stating: “If anyone is the victim of a breach of trust it is 4Kids.”

NATPE 20124Kids will now turn the tables and counter-sue. This second phase of the trial will relate to damages payable to 4Kids relating to the agreement’s purported end and is expected to commence as early as this quarter.

“We are very pleased with the court’s decision which confirms that the Plaintiffs’ purported termination of the Yu-Gi-Oh! agreement was wrongful and that the plaintiffs’ audit claims were baseless,” said Michael Goldstein, interim chairman of 4Kids.

He thanked 4Kids’ clients and business partners for sticking by the company, which produces and distributes TV and digital content, and operates a licensing and merchandise unit.

“We are hopeful that members of the Yu-Gi-Oh! Consortium will take note of the Court’s detailed findings and work with 4Kids to put this matter behind us so that all parties can work together constructively for the continued success of the Yu-Gi-Oh! brand,” added Goldstein.

The anime brand spans a number of TV series, a feature film, a trading card game and video games. The latest series is Yu-Gi-Oh! Zexal, which was produced by TV Tokyo and Nihon Ad Systems.



  1. […] Many people believe that 4Kids purely lucked out and weaseled their way out of punishment for shady business practices on technicality, myself included when I first started writing this article, but it seems that’s not true either. The judge ruled that, in response to the claims that 4Kids owed TV Tokyo and ADK/NAS money as per the audit, the findings were “99% meritless.” […]

    An Absurdly Deep Dive into the History of 4Kids | Part 21: It’s Time to S-S-S-S-S-S-SUE! (2011-2012) | The Anime Madhouse | 2022-09-16 15:09:23

Please wait...