Even though Telltale Games' management thought they had it all figured out when they flash-fired almost its entire workforce, some like Vernie Roberts Jr. sought legal counsel, filing a class action lawsuit against his former employer.
The lawsuit against Telltale's remnants was filed on the behalf of Roberts and all the other "persons similarly situated", alleging that the company's actions violated the Worker Adjustment and Retraining Notification Act (WARN).
The WARN Act stipulates that employers with 100 or more employees must provide a 60 day notification prior to plant closings and mass layoffs. Needless to say, Telltale Games' management did neither, since their abrupt layoff left employees with 30 minutes to clean out their desks and leave the premises.
However, the Act has three exceptions. The first is applicable if a company "actively seeking capital or business and reasonably, in good faith, believes that advance notice would preclude its ability to obtain such capital or business" that would help the company avoid or postpone closure. The second exception are business circumstances that "were not reasonably foreseeable" when the notice would've be given. The third is reserved for natural disasters.
It is said that Telltale was busy closing the final round of financing, when Lionsgate abruptly backed out, although we're not sure that this constitutes "actively seeking capital". After all, Lionsgate was onboard since 2015. The second exception also describes Telltale's predicament to some extent but Telltale was not in great shape financially as it is, since Lionsgate backing out obviously shattered the company.
Note however, that even when these exception apply, "the notice must be provided as soon as practicable [...] and the employer must provide a statement of the reason fro shortening the notice". Not only did Telltale fail to do any such thing, It's unlikely their announcement of The Walking Dead possibly getting a conclusion with another studio will help in this respect.
All things considered, it looks like we're heading for a lenghty legal tussle, because interpretation of the WARN Act is likely to require the court's more extensive insight into the company's business dealings. Let's just hope the employees can weather the storm until it's over.
You can find the class action lawsuit documentation here.