The Buzz: Looking to form a new studio and is in discussions with other publishers.

Mortal Kombat vs. DC Universe screenshot

According to Kotaku sources, Midway's Mortal Kombat development team is in talks with other publishers and wishes to leave the company to form a new studio.

The Mortal Kombat team, lead by senior members, is said to be in the process of negotiating an exodus from Midway. Sources suggest that a lack of bonus payments relating to the success of Mortal Kombat vs DC Universe is the primary catalyst for the move.

The team is also said to have become increasingly frustrated with the handling of Midway's Bankruptcy filing and irritated at having delivered million unit-selling titles on time while other projects suffer endless delays.

Asked for comment, Midway told Kotaku: "Midway is not refusing to pay out those bonuses. It's the unsecured creditors committee that is refusing to allow us to pay them. They're the ones holding that up."

Work on Mortal Kombat 9 is said to be under way at Midway, although how the possible departure of the game's development team will affect its release is unclear - it's unlikely to be good news for the franchise's fans.