In sad news today, 38 Studios, the developers of Kingdoms of Amalur: Reckoning has not been able to meet payroll and has bounced a $1.125 million loan repayment check to the State of Rhode Island. They’ve also laid off all contractors and temporary workers in the last couple of weeks, making it increasingly likely 38 Studios may well be bankrupt.
Kingdoms of Amalur: Reckoning was in development for a a couple of years, during which 38 Studios didn’t have much money coming in. They were surviving off a $75 million loan the State of Rhode Island gave them back in 2010 in a bid to entice them to the state. But, like all loans, loan repayments are regularly due, and the one this month was just too much for the studios to repay. They even tried to pay it by delivering a check to cover the loan repayment 10 days after it was first due. The check, unfortunately, bounced.
38 Studios has more than 375 employees, employees whose jobs now look in jeopardy. The studio is currently in talks with the state as to how to proceed, with an eye on coming up with an agreement that will allow them to repay the loan over a longer period so that state taxpayers don’t get stuck with the bill. There’s no word yet, though, on if such an agreement is possible.
38 Studios began life as Green Monster Games, a gaming studio founded by baseball pitcher Curt Schilling. The company is now named after the number on Schilling’s baseball jersey.
Kingdoms of Amalur: Reckoning, a single-player role playing game, was 38 Studios’ first major game and it’s been somewhat of a smash hit. They’re currently working on a second game, an MMOG called Project Copernicus, but there’s no information on a possible release date, so to expect that to bring in money for the studio is nothing more than a fantasy.
Whether 38 Studios is actually bankrupt isn’t yet know, but it’s not going to be a good weekend for studio employees, many of whom may soon be out of work.