According to reports on Kotaku, the developer has shut down its Seattle, Tuscon and Denver studios, laying off around a third of its entire workforce. But that's not all. Apparently SOE's Austin and San Diego studios have also been hit hard, with around half the staff from each team gone.
Sony Online Entertainment's yet to comment on the situation, but things are sounding pretty grim right now. We'll keep our fingers crossed for all those involved.