Fired 38 Studios Employees Hit with Second Mortgages on Unsold Boston Houses
Original image by Matt Mahurin
A post on Verge today reveals that several of the former employees of 38 Studios—the entirety of whom were laid off en masse yesterday as the company continues to struggle to pay its debts—have been contacted by banks in Massachusetts regarding unpaid mortgages.
Apparently a number of the workers’ houses were said to be sold by 38 Studios when the company and its employees relocated from Boston to Rhode Island. But the banks who have been making contact with the former employees this week have been asking the employees why their mortgages haven’t been paid—clearly indicating that the houses in question, in fact, were never sold.
The Verge post notes that an anonymous representative at 38 Studios (apparently still employed there) said that the company “is working to try and get to the bottom of the notifications and find a resolution.”
In addition, the post speculates that if the $50 million in cash from the $75 million loan given to 38 Studios for the relocation may have been spent on financing or paying mortgages while they were on the market, and if that’s the case, the studio would have violated the terms of the loan.
This is but the latest piece of bad news to hit the nearly 400 employees of 38 Studios who lost their jobs yesterday. It was confirmed a few days ago that the company had stopped paying its employees on May 1, and that the company’s health insurance coverage ran out yesterday.
In addition, the former employees are, for the most part, staying tight-lipped about the situation—at least for the moment. My own attempts to speak with former employees of the company have been met with polite rebuffs. Apparently, many of the fired employees have been told that there’s a possibility of being imminently rehired. Not only that, but one source close to the fired workers has indicated that “most of what was in the news was totally false”—though what, exactly, has been covered inaccurately has yet to be revealed, mostly because the employees seem reluctant to speak to the media.
At this point, all we can do is watch and wait to see what happens next. Should any former employees affected by or involved with this story wish to speak to us about the situation, drop us a line at firstname.lastname@example.org.
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