Last year’s video game Major League Eating for Nintendo Wii and other consoles got mostly lousy reviews, but it might seem even less fun to play if players knew that the Utah programmers and artists who engineered it were not paid for their work, and the company president is now facing tax-evasion charges.
Salt Lake County independent video-game developer Sensory Sweep Studios closed this year in a fantastic implosion of overdue bills, unpaid wages and criminal charges against its owner and his wife. According to the U.S. Department of Labor, the company owes nearly $1 million to about 200 former employees, some of whom feel slighted that prosecutors are using the threat of incarceration to collect unpaid taxes but applying relatively “toothless” civil actions to collect their unpaid wages.
“I would love to visit him in prison,” former employee Paul Grimshaw said of Sensory Sweep president Dave Rushton, echoing the sentiments of other former employees who spoke to City Weekly. “I have a $4,400 dental claim that is probably going to force me into bankruptcy because they weren’t paying dental insurance premiums. ... We started not being to able to pay our mortgage when Sensory Sweep stopped handing out paychecks on a regular basis. That put us in a hole, and we haven’t been able to dig ourselves out yet.”
Grimshaw says he is owed about $10,000 in unpaid wages alone.
The Rushton clan’s history of financial tumult starts years before the founding of Sensory Sweep, including a personal bankrupcy filed by Dave Rushton in 1996. Sensory Sweep was cobbled together with employees and contracts from Saffire Corporation, another Utah independent video-game developer owned by Dave Rushton’s brother, Hal Rushton. Hal later worked for Sensory Sweep.
Grimshaw worked for both companies, although most employees of Sensory Sweep say they were only vaguely aware of Saffire’s history. Grimshaw says he quit Saffire in 2001 when the company was late with paychecks because “they almost went out of business in 1997, and we went three months without pay [then].”
Grimshaw filed an unpaid-wage claim against Saffire in 2001 and was awarded $3,000. Years later, he agreed to work for Sensory Sweep because he needed health insurance and didn’t have other job offers.
Sensory Sweep’s financial troubles began less than two years after it was founded. Court records from 2005 show the company received multiple judgments from the Utah Labor Commission and the Utah Department of Workforce Services. The largest of those judgments was more than $64,000, for not paying unemployment insurance between May 2003 and December 2004.
In September 2005, Sensory Sweep filed for bankruptcy, but the workers didn’t notice, says former employee Todd Smith, who stayed with the company through two business name changes. “Whenever they filed bankruptcy, nothing changed for us. I was on the same project, I had the same cube [workspace]. … I ended up working for a totally different company and didn’t know it.”
Sensory Sweep Studios had already been registered in February 2005, months in advance of Sensory Sweep LLC’s filing for bankruptcy in September. The original company remained in bankruptcy proceedings until October 2009, nearly a year after the company registration expired with the Utah Department of Commerce.
That was not the last time the company gathered debts and quietly reorganized under a new business name, according to records and employee statements. In 2006, Smith says, “I got two [W2s], one from Sensory Sweep and one from Fooptube.” Each of the three companies was registered under the names of different Rushton family members. For example, Christopher Rushton was listed as the registered agent for Sensory Sweep LLC, and picked up a civil bench warrant—records show it was never executed—for failing to appear for a court hearing in 2005 tied to the $64,000 judgment from Workforce Services.
The game-ending troubles began in 2008. Grant Heath says that employee’s 401(k) stopped receiving contributions in early 2008, yet their paychecks were still deducted for the next few pay periods. After a company meeting, “they stopped taking the deductions, but they never did anything to rectify the fact that money had been taken out and just kind of lost to us. Soon after that, we started getting bounced paychecks.” The paycheck problems started when a big customer, California’s Brash Entertainment, folded in October. Employees say Dave Rushton claimed as much as $2 million was owed by Brash.
But the company didn’t lay anyone off immediately, despite the huge financial blow, and Rushton reassured workers that the company would recover.
Several employees filed unpaid-wage claims at the end of 2008. In January 2009, the U.S. Department of Labor filed a civil suit against Fooptube—the latest of the company’s registered names—and Dave Rushton individually, on behalf of 196 current and former employees. The case led to a consent agreement, signed in February, in which Rushton promised to pay $942,000 by September, a promise that was not fulfilled.
In April, the Utah Attorney General´s Office filed six felony charges against Dave and wife Maureen Rushton for failure to file a tax return, tax evasion, unlawful dealing of property by a fiduciary, communications fraud and for a pattern of unlawful activity, or racketeering.
In June, the Labor Department filed a contempt petition alleging they had received six more complaints from employees, beginning in May, claiming they weren’t being paid. In September, the Rushtons were slammed with a $654,000 judgment in an eviction case in which Fooptube and Sensory Sweep were also named.
Citing the criminal charges, the Rushtons declined comment, but Dave Rushton’s defense attorney, Darin Goff, says his client was not living a lavish lifestyle. “I can assure you, I don’t believe there were any expensive cars or expensive homes. Mr. Rushton is a fairly ordinary individual with a very normal standard of living. … The company has met with some very difficult problems related to the economy and industry.”
No former employees claim Dave Rushton was living the high life. He drives a minivan, one said. But employees City Weekly interviewed claimed Rushton was a terrible manager who employed too many unqualified family members and deceitfully reorganized his company to avoid paying bills, taxes and workers. They want him stopped before he does it again.
While the tax-evasion and racketeering charges could put Dave Rushton in jail, several employees are disappointed that the threat of incarceration is not attached to their unpaid wages— only the unpaid taxes.
The Utah Labor Commission has also been investigating Rushton for unpaid wages. Wage Claim unit manager Brent Asay said he cares about workers, but with eight people total in his unit and 2,700 wage claims filed in the past fiscal year, they are doing all that they can. Asay said his office needs the cooperation of prosecutors to file criminal charges against an employer for unpaid wages, something that has not happened in Utah—in his memory—in about 10 years.
“[Government regulators] don’t care about how many people have suffered without their money for this long period of time,” says Kimberly Howell, whose husband and daughter are owed a combined $20,000. “They’re focused on their money.”