Rhode Island governor Lincoln Chafee has confirmed that Kingdoms of Amalur developer 38 Studios has cut staff, presumably as part of an effort to meet its debts to the state.

The number of people who had lost their jobs was not specified, although it is known that all contractors and temporary staff had been let go.

Chafee also confirmed that not every employee had been paid.

The developer made its first loan repayment to the state last week, and is working on an MMO codenamed Project Copernicus, due for release in June next year.

Should the developer fold, the state of Rhode Island will own its IP.