Team Bondi created an amazing virtual world in L.A. Noire, but the studio is now facing the all-too-real world of bankruptcy. Even though the title released by Rockstar Games is one of the top sellers this year, that success proved inadequate to keep its developer Team Bondi out of financial difficulties. The company went into administration this week, according to documents filed with the Australian Securities and Investments Commission, meaning the Sydney-based studio is fundamentally insolvent.

Australia’s legal system reserves bankruptcy for individuals. Companies who are no longer financially viable are placed under the control of an approved administrator, and directors no longer have the authority to act for the company.

Intellectual property and other assets were sold earlier this month to Kennedy Miller Mitchell (KMM), the multimedia company co-founded by Mad Max creator George Miller, according to a report in Develop.

The game industry has been closely following the turmoil of Team Bondi, reporting on allegations of controversial management decisions, contributors being omitted from the credits,  and unacceptable work conditions.  Negative rumors began circulating in 2005 when Sony Computer Entertainment America dropped the project, and continued to  grow throughout the game’s seven-year gestation.  The situation is of keen interest to the Australian game industry in particular, due to the international status of the studio’s flagship game title.

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