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Crowdfunded fighting game Yatagarasu having its money held by PayPal

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Michael McWhertor is a journalist with more than 17 years of experience covering video games, technology, movies, TV, and entertainment.

Yatagarasu Attack on Cataclysm, the PC fighting game from former SNK and The King of Fighters staffers, was the subject of a successful fundraising campaign through Indiegogo this summer. The fundraising drive pulled in more than $118,000 during its month-long campaign, ensuring the continued development and expansion of the 2D fighting game.

Unfortunately for the developer and publisher of Yatagarasu, access to that money has been locked down by PayPal, according to Nyu Media, the game's publisher.

"Bad news," wrote Nyu Media founder Seon King on the game's Indiegogo page. "Today we found out this morning that PayPal have restricted Nyu Media's PayPal account and are refusing to release funding raised for Yatagarasu AoC."

King explains in an update that PayPal considered the funding "reserved" and that it will release "up to 50 percent" of the game's funds prior to its completion, with the rest of the money to be released closer to the estimated February 2014 launch date of Yatagarasu Attack on Cataclysm.

"PayPal refusing to provide funds legitimately raised to complete a game until after the game is released isn't just beyond ridiculous," King said, "it potentially derails the game development."

Skullgirls developer Lab Zero found itself in a similar situation after the successful funding of its Indiegogo campaign. After raising more than $800,000 to continue work on Skullgirls, PayPal froze Lab Zero's account, making it difficult for the developer to pay its workers. The two parties, with the assistance of Indiegogo, later resolved their issues.

In an email, King told Polygon that it initially worked with PayPal to provide documentation about the company, its catalog and Yatagarasu's developer, removing a freeze on the account. However, PayPal is still withholding the developer's funds.

A version of Yatagarasu is coming to PlayStation Vita from publisher Nicalis under the name Legend of Raven.

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