38 Studios Lays Off All Employees, Big Huge Games Shut Down

While we initially learned it as a rumor from Kotaku, a series of social network posts revealed it to be true: 38 Studios is shutting down Big Huge Games, their Maryland-based branch, which they acquired in 2009. Big Huge Games developed 38 Studios' only released title so far, the open-world action-RPG Kingdoms of Amalur: Reckoning, which we learned earlier today has sold over 1.2 million copies to date.

I'll quote company co-founder Tim Train and Reckoning's lead designer Ian Frazier:
Tim Train on Facebook: "I am so fortunate to have worked with the Big Huge Team for over a decade. I cannot imagine a more supportive or dedicated group of people. My thoughts are with everyone and their families on this sad sad day."


Lead designer Ian Frazier on Facebook: "Aaaand, yup, this is definitely the worst day I've had in several years."
Our thoughts go to all the people that worked at the studio, with the hope that they'll be able to find another job position sooner rather than later.

UPDATE: According to an update to Kotaku's article, Big Huge Games wasn't the only one being affected, as 38 Studios' workforce as a whole was laid off today. Here's the tip they received:
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.

Gamasutra even managed to get a hold of the layoff letter:
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.

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

Finally, word comes via Kotaku again that Reckoning needed to sell three million copies just to break even:
Yesterday, Curt Schilling bragged that Kingdoms of Amalur: Reckoning beat EA's sales expectations. Today, Rhode Island governor Lincoln Chafee told reporters that Amalur needed to sell more than double that number just to break even.

Governor Chafee spoke to reporters today during a press conference about the game studio run by Curt Schilling that has all but collapsed.

"The game failed," Chafee said. "The game failed." Chafee was struggling to explain how 38 Studios, a company founded by a star ballplayer and wooed by the state with multi-million dollar loans, could suddenly turn into the poster child for government-financed debacles. What would have spared the company? Chafee: "The experts are saying in the three million range just to break even."