Paizo announced some difficult decisions, with layoffs, live play restructures, and more in the wake of the Diamond Comics Bankruptcy case.
Paizo posted a “difficult update” on its blog today, shedding light on what’s going on in the company as it faces uncertainty in the fallout from the Diamond Comics Bankruptcy proceedings. The publisher and others have been in court fighting to reclaim their own inventory from under a lien placed by JPMorgan Chase, while Paizo was also unable to have an exclusive contract with Diamond terminated, despite Diamond’s inability to fulfill it.
As a result, Paizo made the difficult decision to lay off 12 employees, readjust the organized play program, as well as pausing VTT support for Pathfinder Society modules.
Paizo Faced Nearly $2 Million Loss Amid Diamond Debacle
Look, this news sucks. Especially so for the employees getting laid off because of the financial fallout from the bankruptcy filing. If you haven’t been following the court case and bankruptcy proceedings, essentially, JPMorgan Chase placed a lien on all products stored in Diamond’s Warehouse. This is probably the biggest thing affecting smaller publishers across multiple industries.
These publishers are fighting in court to reclaim their own products, in order to try and recoup some of the losses, because otherwise that’s inventory that can’t be sold. Hence the court battle. However, there’s another wrinkle here.
As Paizo CEO Jim Butler explains in the blog post, Paizo had an exclusive contract with Diamond that prevented the game publisher from finding a new distributor despite Diamond no longer being able to sell Paizo’s books. While that contract was terminated by a judge earlier this year, Diamond has appealed that decision, and things are still up in the air. This has resulted in a loss of $2 million, as well as a write off of nearly $500K in additional sales.
All of which led to the difficult decision to lay off employees. In the blog post, Butler explained that Paizo would be working wih the United Paizo Workers union to follow the “clear, fair process” laid out for implementing layoffs, leaving impacted employees with one week of severance per year of employment (minimum two weeks) as well as advance notice of the layoffs.
Alongside the layoffs, Paizo also announced it would be scaling back its organized play initatives. Pathfinder Society and Starfinder Society will “evolve” as Paizo scales back its production of organized play scenarios to just one each per month (for Starfinder and Pathfinder respectively), as well as pausing VTT support for organized play scenarios.
It’s a sad day and our hearts go out to the employees impacted by the layoffs. Hopefully as the bankruptcy case is settled and Paizo restructures, it will grow out of this difficult phase. In the meantime, the Diamond Comics Bankruptcy continues to impact the larger tableotp industry.
More on the story as it develops
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