Animation Studio Gainax Declares Bankruptcy

Gainax, once a titan in the anime industry, announced its bankruptcy on June 7, 2024, following a filing in the Tokyo District court on May 29, 2024. The announcement marks a somber conclusion to the storied history of the studio behind such classics as Shinseiki Evangelion (Neon Genesis Evangelion) and Tengen Toppa Gurren Lagann (Gurren Lagann). In a candid statement, Gainax's representative director Yasuhiro Kamimura detailed the series of unfortunate events and mismanagement decisions that led to the studio's financial decline, which began over a decade ago. Financial Missteps and Decline According to Kamimura, the studio's financial troubles started around 2012. Poor business decisions, including the mismanagement of a restaurant venture, the ill-fated establishment of a CG company, large unsecured loans to executives, and failed investments in new projects caused substantial debt accumulation. These missteps not only strained Gainax's finances but also eroded its reputation within the industry, leading to its removal from key production committees. The situation worsened as executives who had established affiliate studios bearing the Gainax name took much of the talent and resources, leaving the original studio without an established production line. These affiliates later disclaimed any relationship with the original studio, further isolating Gainax. Leadership Changes and Operational Shutdown In 2018, the long-serving representative director transferred shares to an individual with no experience in animation production, with the approval of then-management. Shortly after becoming the president in 2019, the individual was arrested for sexual misconduct involving a minor, causing a complete operational shutdown while debts continued to mount. Attempts at Revival and Final Collapse A revamp of the management team in February 2020, in collaboration with animation studio Khara as a creditor, led to an extensive review of Gainax's financial and operational status. The investigation uncovered extensive borrowing, debt defaults, and unauthorized sales of intellectual property. Despite a coalition of companies working pro bono to address these issues, the efforts were hampered by the previous management's continued operations under the Gainax brand without regard for the dire financial situation. Faced with a lawsuit from a debt collection company in May, Gainax ultimately filed for bankruptcy, acknowledging its inability to continue as a business. Gainax noted in the addendum that it has no current affiliation to Gaina and Fukushima Gaina (both formerly Fukushima Gainax), Gainax International, Gainax Kyoto, Yonago Gainax, Gainax Niigata, and Gainax West. Khara's Intervention and Future Prospects Khara, founded by Gainax co-founder Hideaki Anno, issued its statement following the bankruptcy announcement, providing additional context. Khara had been aware of Gainax's financial struggles and debt for some time. Anno expressed his long-standing concerns and made proposals for management improvement; however, his attempts to implement corrective measures were unsuccessful. Despite these circumstances, Khara provided supportive loans at the request of the then-management. Following this president's arrest, Anno sought to protect the reputation of the Evangelion franchise and related works. Khara enlisted the cooperation of Kadokawa, King Records, and animation studio Trigger, having representatives from these companies join Gainax's board to better understand and address the company's issues. The board looked to resolve unpaid debts to studios, authors, and creators within the industry, and prevent the dissipation of intellectual property and materials. However, by the time Khara fully grasped the internal situation, the company was already in an irreparable state of insolvency. Khara, now the manager of the Gainax trademark, has pledged to work with production committees to confirm and transfer rights to the most suitable companies and individuals, ensuring that creators can continue their work. Although Khara considered providing further support, the possibility of supporting Gainax's debt repayment was deemed unfeasible by the company. The future management of works previously overseen by Gainax will be announced following the conclusion of the bankruptcy proceedings. While the closure of this long-standing animation studio comes as a shock to many in the anime community, its impact on the business side of the industry appears minimal. Gainax had already ceased producing new content since the 2015 series Houkago no Pleiades (Wish Upon the Pleiades) and had halted its production activities in recent years. The rights to its notable works have mostly been transferred to other companies, with Shinseiki Evangelion (Neon Genesis Evangelion) now held by Khara and Panty & Stocking with Garterbelt by Trigger. Gainax's Legacy Gainax was founded in 1984 by Hideaki Anno, Yoshiyuki Sadamoto, Takami Akai, Hiroyuki Yamaga, Yasuhiro Takeda, Shinji Higuchi, and Toshio Okada—with the purpose of producing the Ouritsu Uchuugun: Honneamise no Tsubasa (Royal Space Force: The Wings of Honneamise) anime film. Originating from the anime fan group Daicon Film in Osaka, Gainax stood out in an era where most animation studios were established by former staff and producers from major studios. The studio went on to create hits such as Fushigi no Umi no Nadia (Nadia: The Secret of Blue Water), Kareshi Kanojo no Jijou (His and Her Circumstances), and Tengen Toppa Gurren Lagann (Gurren Lagann). Among these, Shinseiki Evangelion (Neon Genesis Evangelion), which started as a television series in 1995, became a monumental success. However, from the 2000s onward, Gainax experienced significant talent departures, with Hideaki Anno leaving in 2007 to establish Khara and key staff from Gurren Lagann forming Trigger in 2011. Gainax's bankruptcy signifies the end of an era, underscoring the importance of prudent management and safeguarding creative assets within the competitive landscape of the anime industry. Despite its closure, the legacy of Gainax's groundbreaking contributions to anime will endure. Source: Animation Business Journal, IT Media, Tokyo Shoko Research