LOS ANGELES--Beleaguered Kingdoms of Amalur: Reckoning and Project Copernicus company 38 Studios has filed for bankruptcy, a spokesperson confirmed today to Rhode Island news outlet WPRI. This means the company has ceased operations and will be liquidated.
On top of this, the Rhode Island state police, the attorney general's office, the U.S. Attorney's office, and the FBI are launching investigations into the company.
According to documents obtained by WPRI, 38 Studios owes between $100 million and $500 million, spread across at least 1,000 creditors. The company estimated its assets at between $10 million and $50 million, saying in court documents that it does not have the funds necessary to make good on the payments.
38 Studios' Baltimore, Maryland-based outfit Big Huge Games owes between $50 million and $100 million, spread across at least 200 creditors, the documents show, with estimated assets at between $500,001 and $1 million. This company developed Kingdoms of Amalur: Reckoning, which shipped in February to a warm critical reception and sales of 1.2 million in its first 90 days.
Two other 38 Studios subsidiaries--Mercury Project LLC and Precision Jobs LLC--each disclosed $100 million to $500 million in liabilities and less than $50,000 in assets in court documents.
38 Studios' troubles first came to light last month, when reports from the Rhode Island government indicated the company had failed to make a $1.125 million loan payment to the state's Economic Development Corporation. The studio eventually made the payment, but it also enacted a round of unspecified layoffs. Reports also surfaced that 38 Studios could not pay its employees as scheduled twice in May and that some employees had been stuck with a second mortgage.