Factor 5 animator Sam Baker has been getting into a bit of mess over a recent blog that caught the attention of 1up. In his blog Baker stated that Factor 5 had stopped a project he was working, hadn't paid employees, had cut health care benefits and needed further funding within a week or they would be forced to cut the staff.
1up went on to publish the story and Baker retracted his blog replacing it with one that was saying something entirely different. Namely that the publisher on his project - Brash Entertainment - had not paid Factor 5 but that the project was still being worked and that Factor 5 is doing "super fine" - well expect for the project he was working on that needs to find a publisher fast.
Either it is a case of Baker exaggerating and lying in his first post or he has been whipped into line as some of the stuff that he revealed isn't exactly going to help Factor 5 find funding if they need it.
I guess the next few weeks will reveal if Baker was jumping the gun or telling the truth in his first post. Factor 5's most recent release Lair on PS3 sold very poorly and received harsh criticism from the media. Factor 5 have been confirmed to be working on at least on Wii project (speculation points to a new Pilot Wings), but otherwise very little is known about what the former German (now San Francisco based) developer is up to.
Source: 1up story
Sam Baker's updated blog
Sam Baker's original (cached) blog
My take on the situation is that the truth lies somewhere in between. I have a hard time thinking that losing the Brash Entertainment contract would put all of Factor 5 in jeopardy. Cutting some staff when you loose a publisher is common practise in this industry and nothing to be to alarmed about. It has happened more often lately as several publishers are in deep trouble due to long term mismanagement accelerated by the current credit crunch.