Millions in Tax Payer Money Squandered and Video Game Studio Sacks All Staff

38 Studios in outrageous lay-offs and loan problems shocker

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You're fired.
You're fired.
In a move that even some cyborg-slave owners might condemn as a bit cold and inhumane, the bosses over at Kingdoms of Amalur: Reckoning developer, 38 Studios, having failed to pay employees has now laid them all of via an incredible email dismissal.

Despite selling upwards of 300,000 copies of its début title, the studio, has been in trouble for some time (see reports). However, with a well received game and the bullish backing of owner and ex-major league basketball player Curt Schilling and the Rhode Island state governor, it was hoped that business problems might be resolved. Then came this outrageous email:

"The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a companywide lay off is absolutely necessary.

"These layoffs are non-voluntary and non-disciplinary."

The local news reports that, "Curt Schilling's taxpayer-backed video game company was unable to make payroll this week, Judy Chong, a spokeswoman for the R.I. Economic Development Corporation, confirmed Thursday in response to an inquiry from WPRI.com.

"Separately, Governor Chafee's office said 38 Studios hand-delivered a check around 5 p.m. for the overdue $1.125 million payment to the EDC, which set off this week's crisis. But Rick Wester, its chief financial officer, told the EDC there were insufficient funds to cover the check, and so the agency returned it."

"This is your official notice of lay off, effective today, Thursday, May 24th, 2012."

An anonymous member of staff made this situation all too human by posting this:

"38 Studios just laid off its entire staff, both Providence and BHG studios are being shuttered.

"We have not received a paycheck since April 30th.

"On May 15th, we found out we were not getting paid when our checks did not hit our accounts.

"Our medical insurance runs out tonight at midnight.

"We found this out when an employee's pregnant wife was told by her doctor, this was on Tuesday 22nd May this week.

"The company has not communicated anything concrete to the team throughout this process, leaving team members to figure out insurance stop-gaps (where people could afford it), etc. on their own."

In terms of tax payer money, "So far, 38 Studios has received $49.8 million of the $75 million in loan proceeds, according to bond documents obtained by WPRI.com. Officials have not said whether the game 38 Studios is supposed to create in Rhode Island is on schedule. Schilling, who founded the firm in 2006, has refused to answer questions from reporters."

Sources:
GamasutraWPRI.com

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