They no longer work for Microsoft, and instead have a publishing deal with Activision where they intend to create a new racing series titled Blur.
[quote]
“From a business perspective, we are targeting Blur to do for racing what Call of Duty did for shooters,” Activision CEO Michael Griffith stated. “That was the goal when we originally acquired Bizarre Creations to make this game.

“Blur brings real innovation to the racing category and is looking very strong. You will all get a chance to see this game first-hand at E3, but suffice it to say, we are excited to be entering this genre with this game.”</blockquote>

As big fans of Project Gotham, we can't wait to find out more.