Sources: Game Studio Red 5 Misses Payroll On Christmas

Video game development studio Red 5, best known as the company behind the online game Firefall, missed payroll last week and could not pay its staff on Christmas day, according to several people familiar with goings-on there. One source close to the studio, requesting anonymity so as not to endanger their career, shared messages and Facebook posts from several employees saying they were not paid last week. A second source also reached out this weekend about the news, telling me that their colleagues at Red 5 are expecting the worst.

In November, Red 5 laid off 40 employees, and last week, the studio laid off several more, a source said. Red 5 typically pays its staff every other Friday, but on December 25, employees didn't receive their paychecks. Several employees said they received the following letter:

Hi Team,

I regret to inform you that Red5 currently does not have the funds necessary to meet our payroll scheduled for today Friday, December 25. Due to this, there will not be payroll paid this week.

Red5 and The9, our parent company, is currently working to resolve this, during the holidays, as soon as possible. We are hopeful we'll be able to resolve this and will update the team immediately.

Founded in 2005 by ex-Blizzard employees, Red 5 has gone through all sorts of tumult over the past few years, including the ousting of several founding staff. In 2010, the Chinese company The9 bought a majority interest in Red 5.

A call to Red 5's offices in Irvine, California this morning went unanswered.


Comments

    "Merry Christmas people, here's no pay, I heard that a lot of charities are offering free food this time of year"

    Wow what a pack of c*nts, great timing also.

    The worst part is... They would have known this was going to be the issue weeks before it happened... So my question is.. .Why did they still have them work over the period that they aren't able to be paid???

      When the agency I was working for went under (a few years back) we only found out on payday... the last one before christmas. Someone obviously knew that the pay run was going to break the bank but they went on right up until they had to pay us and then they told us. Walked out with nothing, just before christmas.

      We got a lot back much much (much) later. Like over a year. But that was partially through asset sales and partly through government guarantees. That christmas was a bit shit.

      I dunno, why would a company want it's employees to work without pay?

        If American corporate law is like Australia's then they could be on the hook for trading while insolvent. The trick though is being able to convince people they weren't insolvent in the lead up to Christmas and then close or refinance the company afterwards. It's a messy business and not one I would wish on anyone having been through it myself a couple of times.

    Sounds like the company isn't in good shape.

    Fingers crossed the employees get their pay.

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