Vancouver will be on the professional video gaming map in late August when Rogers Arena hosts the $27 million International Dota 2 Championships.
But a local e-sports company with two venues, competitive teams and plans to become a player agency, has collapsed.
While the MLGB E-Sports Club website says its Vancouver and Richmond locations were closed for equipment upgrades, documents from a B.C. Supreme Court case say otherwise.
May 1 reasons for judgment say that the club’s general manager was hired last summer for $10,000 a month, but is owed $40,000 in back pay and $36,000 in expenses. On March 5, he complained to the province’s Director of Employment Standards and continued to work until March 7.
“On that day, he had arranged to meet with [MLGB owner Zhiheng] Zhou to obtain $10,000 toward partial payment of his outstanding salary,” said Justice Barbara Norell’s written verdict. “Shortly prior to the meeting, Zhou left him a voicemail message stating that: (a) the company’s assets were frozen; (b) he wouldn’t be meeting with him to give him a cheque; (c) MLGB was closing its business; and (d) he would be permanently leaving for China.”
As of May 2, the website for MLGB E-Sports still reads, in bold red letters, “due to upgrading the equipments, we are closing the stores for maintainance (sic) until the end of March.”
Calls to the Vancouver number listed on the website go to a generic voice mail system. The Richmond number is out of service.
In the verdict, Norell also awarded $500,000 plus interest to three plaintiffs who sued Zhou and the company for failing to repay a loan connected with the Richmond store.
Between November 2015 and December 2016, Chao Bai, Bai Wang, and Wenwei Zhu gave Zhou $1.01 million to finance a new location in Richmond. The plaintiffs demanded their money back when it did not open as planned, but reached a settlement agreement for repayment. On May 24, 2017, Zhou and his company delivered cheques for $100,000 to the plaintiffs’ lawyer and $600,000 from a numbered company to the plaintiffs’ lawyer’s trust account.
“Shortly thereafter Zhou advised Bai that MLGB did not have the funds to honour the $600,000 cheque and advised him not to deposit the cheque,” Norell wrote.
Zhou gave the plaintiffs’ lawyer $200,000 on July 23 and agreed to pay the remaining $500,000 by Nov. 23. He did not deliver the first instalment of the $500,000, so the plaintiffs filed a lawsuit last Sept. 13.
“The defendants deny they breached the settlement agreement and deny that any amounts are owing under it,” according to Norell. “They do not plead any facts as to how they met the terms of the settlement agreement or did not breach it.”
Norell held a one-day hearing on March 27. No lawyers appeared for Zhou.
Zhou filed a counterclaim last October, alleging that Bai defamed him to new potential investors. Zhou argued that any damages granted the plaintiffs should be offset by damages for defamation.
He alleged Bai told potential investors that Zhou stole a million dollars from the plaintiffs, used it to open the Richmond location and refuses to hand over the store or the stolen money. Bai’s lawyer demanded proof of the investors, the words spoken or published, and where they were published.
Zhou’s lawyer named the potential investors as Fei Gao, Shuai Xiao, Shan He and Zihao Zhou and claimed the statements were made last fall in Richmond.
The judge struck the defamation counterclaim, because the date, time, exact location and persons to whom the statements were made were not indicated in the pleadings or particulars.
MLGB’s website says it owns competitive teams in League of Legends and Playerunknown’s Battlegrounds and was developing a pro player agency. “Local gaming internet café clubs will provide a foundation for the infrastructure that we are eager to build,” it says.
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