Jakks Pacific Inc said Wednesday it had entered into arbitration with joint-venture partner THQ Inc. over the Malibu toymaker’s decision to extend its videogame licensing with World Wrestling Entertainment Inc.

Jakks and Agoura Hills videogame maker THQ have a license with WWE that is scheduled to expire Dec. 31, but Jakks recently announced that it plans to exercise its option to renew the license for another five years. THQ has claimed it was not ready to make a decision on the proposed renewal and filed a lawsuit in Los Angeles County Superior Court.

THQ claimed in the suit that the companies’ joint-venture agreement does not allow Jakks to issue a renewal notice on its own. The company also argued that a restrictive covenant in their joint venture pact, which prohibits THQ from publishing any competing wresting videogames during the term of the agreement, is unenforceable under state law.

After the midday announcement, shares of Jakks closed up 29 cents, or 2 percent, to $13.12 on the Nasdaq. Shares of THQ added 43 cents, or 6 percent, to $7.59 on the same exchange.