Double Fine Studios has dismissed 12 employees after the project they were working on was scrapped.
Schafer clarified that the cancellation of the unannounced title was not Double Fine's decision, and layoffs were unavoidable, according to GamesIndustry.
"One of our unannounced projects was unexpectedly cancelled by its publisher, forcing us to reduce our staff by 12 people," he said.
"Our remaining projects – Broken Age, Massive Chalice and Grim Fandango Remastered were unaffected."
Back in March, Double Fine also revealed it would be publishing indie games.