Sonic co-creator found guilty of insider trading breaks silence to accuse Square Enix producer of being 'the kind of person who would submit lies to court'

Yuji Naka presents Balan Wonderworld while dressed in a top hat and neckerchief.
(Image credit: Square Enix)

Sonic co-creator Yuji Naka has had something of a varied career since leaving Sega, initially focusing on his own company Prope before teaming up with Square Enix to direct the ill-fated Balan Wonderworld. The latter wasn't a great game, and ever since release Naka and the publisher have been engaged in something of a moral blame game, as well as a wider war of words sparked by an insider trading case brought against Naka and two other Square Enix employees in 2022.

Naka was arrested in November 2022 on suspicion of insider trading while the creator was still at Square Enix, the main accusation being he had bought shares in Aiming Inc knowing that Square Enix planned to collaborate with the studio on mobile game Dragon Quest Tact. A month later Naka was arrested again, this time in relation to a similar situation with studio ATeam and mobile game Final Fantasy 7: The First Soldier.

The father of Sonic came this close to jail time, despite admitting his guilt during his first court appearance in March 2023: "There is no doubt that I knew the facts about the game before it was made public and bought the stock." In July 2023 he was sentenced to a whopping fine of $1.2 million and a two-and-a-half-year prison sentence, suspended for four years. Naka's "remorse" saved him from chokey, but he has to be on his best behaviour until 2027.

Naka hasn't made any public comments since shortly before his arrest in November 2022, but he's now returned to his old Twitter account purely to take some shots at a Square Enix employee who worked on Balan Wonderworld (thanks, VGC). His return was sparked by reports that Yu Miyake, executive producer on Balan Wonderworld but better-known for his work on the Dragon Quest series, was to be re-assigned at Square Enix.

The most eyebrow-raising element by far is that Naka accuses Miyake lying in his court submissions during Naka's trial.

"It feels like it's finally happening," said Naka, via machine translation. "I hope he'll be gone soon because he's the kind of person who would submit a note with lies (with evidence) to court. I've never met him, but the new president [of Square Enix] seems like a good person."

Miyake was in charge of Dragon Quest, and his new role will be overseeing a newly established studio focusing on smartphones. So one could choose to see this as a demotion, as Naka certainly does. But it's the accusation of lying that makes it clear Naka's bitterness about the insider trading case, and his time at Square Enix more widely, persists. 

If nothing else, this situation has offered a glimpse of the upper echelons of the Japanese industry, with Naka's assertion being that he was replaced by subterfuge during a period he was ill. Naka is not only clearly aggrieved by his treatment, then and now, but blames Square Enix for separating him from the project and releasing a substandard game with his name on it.

"What would you do if you were to be ill for a long time," wrote Naka in July 2022, "and unable to do anything because of it? And how would you feel if you were the director of an unfinished game and it was heavily criticized?"

Naka also apologised to players for the state the game released in, and ended of course with another backhand aimed towards Square Enix: 

"Personally, I'm really sorry that I released the unfinished work Balan Wonderworld to the world. My intention with the game was to put it out in a proper form as an action game. But I think Square Enix and Arzest are companies that don't care about games and players."

I've contacted Square Enix for comment from both itself and Yu Miyake on Naka's allegations, but the publisher has not replied. I'll update with any response.

Rich Stanton

Rich is a games journalist with 15 years' experience, beginning his career on Edge magazine before working for a wide range of outlets, including Ars Technica, Eurogamer, GamesRadar+, Gamespot, the Guardian, IGN, the New Statesman, Polygon, and Vice. He was the editor of Kotaku UK, the UK arm of Kotaku, for three years before joining PC Gamer. He is the author of a Brief History of Video Games, a full history of the medium, which the Midwest Book Review described as "[a] must-read for serious minded game historians and curious video game connoisseurs alike."