Silicon Knights is down to a handful of employees and, as Polygon reports, has sold off many of its physical assets and shut the doors to its office.
This follows after a group of core employees, including founding member and controversial figure Denis Dyack, left to found a new development studio in Precursor Games. Precursor is now working on Shadow of the Eternals, a spiritual successor to Eternal Darkness: Sanity’s Requiem. The project was crowdfunded on Precursor’s own website, rather than going through a third party service like Kickstarter.
Following Dyack’s departure, Epic Games successfully countersued Silicon Knights after the latter developer sued the Unreal Engine. The case claimed that Epic used licensing fees that Silicon Knights paid for Too Human’s use of Unreal to pay for the development of Gears of War. However, the court declared that Silicon Knights had breached a licensing agreement, awarding Epic $4.45 million.
To complicate matters further, it is alleged that Silicon Knights received a $4 million loan from the Ontario government, leaving them very much in debt.
We’ve reached out to both Silicon Knights and Precursor for comment.