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Is Funimation afraid of the Houston Dragon?
by Chris Perry - Date: Thursday, January 19, 2012 20:03:43 EST
Funimation's lawsuit against ADV comes at an unusual time for successor company Sentai Filmworks
This article is part of our continuing coverage of Funimation v. A.D. Vision Inc. et al.
Further coverage of this case will be available at KeepAnimeAlive.com in the future. KeepAnimeAlive.com and the Anime Defense Project Inc., are not affiliated with any of the companies involved in this legal case, and do not support either side over the other. 

HOUSTON, TEXAS - KEEPANIMEALIVE - No one knew what to expect from Sentai Filmworks. The closure of ADV Films and the sale of its properties to a consortium of companies that included this little production house was, to many people, the end of an era. It firmly cemented its Texas neighbor, Flower Mound-based Funimation Entertainment, as the leader in anime in the United States. With big hits like Full Metal Alchemist and One Piece, how could Sentai Filmworks survive?

But in the intercedent years, Sentai has slowly shown its colors. With the release of Highschool of the Dead, the studio finally had a real hit and now shows like No. 6, UN-GO, MM!, ICE, Grave of the Fireflies, and others, the company has positioned itself firmly in the anime community.

In fact, Sentai Filmworks may be on track for a better 2012 than Funimation. Funimation has been searching for a hit title to release this year. The company will almost certainly get rights to Evangelion 3.0: You Can (Not) Redo, but with that film not scheduled to be released in Japan until this fall, it may not make it here until 2013 at the earliest.

In the meantime, Sentai's releases, including the smash hit No. 6, could help the company retake market share. Sentai Filmworks is probably the second largest anime company in the United States according to researchers at OnCulture, a research organization owned by the Anime Defense Project, but they're a much more distant second than Funimation was in the ADV days.

All of this makes the timing of Funimation's lawsuit against Sentai Filmworks and the other former ADV companies suspicious. According to the suit, Funimation has had the right to pursue ADV since 2008, and Sentai Filmworks has questioned whether the statute of limitations has expired (OnCulture researchers tell KeepAnimeAlive that Texas law should allow Funimation to pursue the company until late 2012 for unpaid debts, but that civil cases must be brought within two years of the date of the alleged incident).

Sojitz, through partnership Japan Content Investments, owned 20% of A.D. Vision. It isn't clear what happened to that ownership, though A.D. Vision founder John Ledford II said the companies had a "breakup," suggesting that Sojitz may have divested.

There are likely hidden factors at play. A.D. Vision Inc. sued Gainax earlier in 2011, alleging that the company had violated the terms of a contract designed to let ADV develop a live-action film based on the Evangelion franchise. The lawsuit shocked the community, many members of which were not aware that ADV still existed as a legal entity. In the meantime, AEsir Holdings, the company to which ADV transferred the rights to the Evangelion TV series, has apparently lost those rights.

However, so much of this is still speculation. The only facts we truly know are these claims: Funimation claims that ADV's actions were intended to circumvent their debts to Sojitz and, subsequently, to Funimation. Sentai Filmworks claims that since it didn't exist at the time of the contract, it can't be sued.

If Sentai wins, that will be good news for the studio as it looks ahead to a good year.

Of course, that good year will be 2013, since this case won't be heard until October.