Auditor-General asked to check claims against Adelaide game developer

An Upper House MP has called upon the Auditor-General to review allegations about control of intellectual property and use of government funds levelled against Adelaide’s biggest independent game developer.

Jun 07, 2021, updated Jun 07, 2021
Mighty Kingdom managing director Phil Mayes (Centre left), alongside then-Premier Jay Weatherill and Innovation Minister Kyam Maher (Photo: @JayWeatherill / Twitter)

Mighty Kingdom managing director Phil Mayes (Centre left), alongside then-Premier Jay Weatherill and Innovation Minister Kyam Maher (Photo: @JayWeatherill / Twitter)

The former Labor Government awarded Mighty Kingdom a $480,000 grant in 2018 to hire 16 employees and develop “Kitty Keeper” – a game the company dubbed “the largest independent game ever made in SA” although it was deleted from the App Store after less than two years on the global market.

But while giving evidence to a parliamentary committee in February, game designer Justin Daley – who first floated the Kitty Keeper concept to Mighty Kingdom in 2016 and paid the company more than $400,000 to develop his idea – alleged the company “falsely claimed control” of his intellectual property to “gain financial benefit in the form of a $480,000 taxpayer-funded grant”.

Daley went on to call for an audit of the company to “find out where this money has gone”.

Mighty Kingdom has denied any wrongdoing in its contractual obligations with both the State Government and Daley, and says the grant monies enabled them to hire 16 full-time permanent employees.

“Mighty Kingdom has fully complied with all of its obligations under the contract arrangements with the South Australian Government, cooperating fully, including ongoing and regular reporting regarding the grant,” managing director Phil Mayes said in a statement to InDaily in February.

The Department for Innovation and Skills (DIS) – which was in charge of administering the $480,000 grant – also investigated Daley’s allegations in September last year, determining his claims to ownership in the game were “not clear cut”.

Department CEO Adam Reid wrote to Daley on September 28, 2020, to say he did not consider it “appropriate or possible for me to adjudicate on what appears to be a genuine dispute between you and Mighty Kingdom as to the ownership of intellectual property in the game”.

“Consequently, the Department will not be taking any further action in relation to your complaint.”

Reid also noted a Services and Revenue Share agreement signed between Daley and Mighty Kingdom in December 2018, around 10 months after the grant was awarded, which warranted the company holds “all IP Rights in the KittyKeeper Game” while Daley owns “all IP Rights in the KittyKeeper brand”.

But SA-Best MLC Frank Pangallo says the explanations Daley has received “do not go far enough” and the content creator is “entitled to a proper independent investigation”.

Pangallo sent a letter to the Auditor-General Andrew Richardson two weeks ago calling on him to give Daley’s claims “every consideration as a matter of important public interest”.

“From the information provided to me and other colleagues in Parliament – including the Select Committee – I fail to be convinced by the explanation and rebuttals given by the government to Mr Daley,” Pangallo wrote in the letter.

“I am of the strong view the awarding of this grant – and others Mighty Kingdom may have received from the South Australian Government – certainly warrants a ‘fresh set of eyes’ in the form of an independent investigation/audit by your office to ensure proper compliance with conditions.

“Private companies which operate in the often-speculative area of information and technology development – like Mighty Kingdom – and which are recipients of significant taxpayer funding, must be subjected to an appropriate level of scrutiny to ensure the money is being spent accordingly.”

Greens MLC Tammy Franks, who has filed Freedom of Information Requests to the DIS on behalf of Daley, said she “fully supported” Pangallo’s referral of the allegations.

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“As Frank has said, the State Government are yet to give us satisfactory answers or a full explanation,” she said.

“At best we get incomplete snippets of information and unclear investigations.

“There is public money involved, and so the public deserve answers – as does Justin Daley.”

Mighty Kingdom declined to expand on its previous comments.

“In 2020 Mighty Kingdom removed Kitty Keeper from the App Store and Google Play, when the contract to publish the game was terminated in accordance with its terms,” Mighty Kingdom’s Mayes said in February.

“Regarding all matters claimed by KitCatCo Pty Ltd (Daley’s company), we reiterate that Mighty Kingdom has fully complied with all of its contract obligations with both the Government and KitCatCo Pty Limited.”

A spokesperson for DIS told InDaily that “all aspects of the [government] contract have been complied with” and “while the Kitty Keeper app is no longer available for download, the jobs created have been retained at Mighty Kingdom”.

“Mighty Kingdom continues to be a South Australian success story, creating jobs and contributing to South Australia’s economy,” the spokesperson said.

Mighty Kingdom – founded in 2010 and based at the Game Plus development hub on Pirie Street – is the largest independent game developer in Australia, having released 20 mobile, PC and console games to more than 50 million users worldwide. It now has 88 full-time employees and listed on the ASX in April this year following a successful pre-initial public offering of $4 million.

Shadow Attorney-General Kyam Maher, who was Innovation Minister when the Kitty Keeper grant was awarded, has said concerns over IP ownership should be referred to the courts and noted that “not every single game is going to be a roaring success”.

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