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Curt Schilling’s 38 Studios lays off its entire staff

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Curt Schilling (Getty Images)

The sad saga of 38 Studios took an even more depressing turn Thursday afternoon.

The beleaguered game maker run by former Boston Red Sox pitcher Curt Schilling abruptly laid off all of its employees, effective immediately. Insiders at the company say they also learned their health insurance will run out at midnight.

Employees learned of the layoffs through an internal email, which Gamasutra has obtained.

It reads:

"The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a company wide 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."

Meanwhile, a person claiming to be a now-former employee of the company told Kotaku that no one has been paid since April 30 -- and company officials have not communicated the status of things to workers throughout the process.

Rhode Island news outlet WPRI reports the company had 379 employees as of March 15, 288 of which were located within the state, with the remaining located at the offices of Big Huge Games in Maryland. That subsidiary studio, too, was reportedly shut down today.

38 Studios, which earlier this year shipped the role-playing game Kingdoms of Amalur: Reckoning, is in the throes of a severe financial crisis that's been impacting the entire state of Rhode Island. The developer, which obtained a $75 million loan from the state, failed to make a $1.125 million payment last week, eventually scraping together the funds at the expense of payroll.

While Kingdoms of Amalur: Reckoning was a mid-level hit, it was unable to help the company stay afloat. 38 Studios has been working on a massively multiplayer online game, codenamed "Copernicus," though that likely has been shelved now with the development team dismissed.

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