Game studio owner suddenly lays everyone off and blames a Kotaku report that hasn't been published

In the memo, Possibility Space owner Jeff Strain, who previously co-founded ArenaNet and Undead Labs, tells the studio's staff that he was recently contacted by Kotaku reporter Ethan Gach with questions about the closure of Crop Circle Games, another studio he owned with wife Annie Delisi Strain under their company Prytania Media.

Gach's questions included "non-public information" about Possibility Space's [unreleased] first game, Jeff Strain said in the e-mail, as well as confidential Prytania Media business information, including the identity of its publishing partner. Jeff was shocked, he said, to learn that the information had come from current employees. He claimed that after disclosing the leak to their publishing partner, the company "expressed low confidence they would be willing to invest the additional resources needed to complete the game." Jeff and the unnamed publishing partner then "mutually agreed to cancel" the project.

The letter goes on to announce that Possibility Space is closing immediately, and concludes with the note that Jeff is "stepping away from the game industry" to focus on his family and care for his wife, who recently disclosed a serious medical diagnosis.