Genius have contracted 7 Studios to work on their Scratch game, who is now owned by Acti after a failed bid to buy the Scratch IP. They allege the mega-publisher is withholding work.
Activision and 7 Studios have "conspired to withhold the current version of Scratch in an effort to delay the development and release" of the game alleges Genius Products.
"We believe that Activision and 7 Studios have improperly used confidential information obtained from Genius and 7 Studios to interfere with our efforts to complete the game," said Trevor Drinkwater, Genius Products' president.
"In short, we believe that Activision is attempting to sabotage the release of our much anticipated game and prevent it from getting to market prior to the release of DJ Hero."
Genius also reveal that Activision attempted to acquire the Scratch videogame property from them but shot down the idea. The publisher then decided to purchase 7 Studios and subsequently "conspired to prevent Scratch from getting to market on a timely basis by withholding work product, code, and the proprietary game controller."
Industrial sabotage; these are serious accusations indeed and there has been no comment from Activision yet.