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Heihachi Mishima, the powerful and ruthless owner of the multi-national Mishima Zaibatsu, has announced the King of the Iron Fist Tournament, a fighting competition with a one billion dollar cash prize. There are eight competitors, and one of them is an undefeated world champion who is apathetic towards the prize money and solely wants to take his revenge on Heihachi.
This man's name is Kazuya Mishima, the son of Heihachi. As history puts it, when Kazuya was five years old, Heihachi threw him off a cliff to see whether or not he was really his son (this would be determined by Kazuya's ability to survive the fall and climb back up). Kazuya did indeed survive the fall, but it left a deep and bloody scar on his chest which was slowly claiming his life. The Devil appeared before Kazuya, offering him the opportunity to retrieve his strength back to take his revenge on Heihachi in exchange for his soul. Kazuya, driven by anger and hatred, accepted.
The King of the Iron Fist Tournament takes place twenty-one years later, and by now Kazuya is an undefeated champion (the only blemish on his record being a draw against Paul Phoenix, another character from the game who wishes to win the tournament as well as defeat Kazuya). Kazuya enters the tournament, and ultimately makes it to the final round where Heihachi awaits him.
Kazuya and Heihachi clash in battle atop the same cliff from which Heihachi once tossed Kazuya, with the violent and bloody fight raging on for hours until Kazuya, powered by the strength given to him by the Devil, overpowers Heihachi and beats him into unconsciousness. Kazuya picks up his father's broken body, and drops it from the cliff. Smiling to himself in triumph, Kazuya is now the new owner of the Mishima Zaibatsu.