Midway has filed for Chapter 11 bankruptcy in order to gain more time to pay their debts which total 240 million. Midway is the publisher of the long running Mortal Kombat series of video games. Midway's debt consists of $150 million owed to various note holders (with Wells Fargo as trustee), and another $90 million owed to the publisher's former majority shareholder, National Amusements. National Amusements is headed by Sumner Redstone.

According to Midway one of the causes of their current financial problems was last November's "change in ownership," when then majority stockholder Sumner Redstone sold off his 87 percent stake in the company valued at $30 million for $100,000. As a result of the ownership change, Midway's debtors have the right to call in the company's debts if they so choose.

If Midway were to default on the $150 million debt, National Amusements would have the right to call in the $90 million that it loaned Midway. 

The decision to file bankruptcy buys Midway time to reorganize. Midway chairman, president, and CEO Matt Booty stated, "This was a difficult but necessary decision." He also added, "This filing will relieve the immediate pressure from our creditors and provide us time for an orderly exploration of our strategic alternatives. This Chapter 11 filing is the next logical step in an ongoing process to address our capital structure."

The news is not all bad for Midway as they have shipped (not sold) roughly 2 million copies of their latest iteration of the Mortal Kombat franchise, Mortal Kombat vs. DC Universe. According to GameSpot, Midway was proudly playing up the fact their TNA Impact title has also shipped more than 1 million units, and its Game Party franchise had sold more than 3 million units as of the end of 2008.