Vostu Lays Off Undetermined Amount of Employees

Brazilian social games company Vostu has laid off an unspecified number of employees this week. The South American social game maker had an estimated 600 employees in December – before the layoffs. Vostu claims that these layoffs have more to do with consolidation of development teams, and not the settlement of a lawsuit with social game maker Zynga.

Zynga filed a lawsuit in June 2011 alleging that the Vostu was copying Zynga’s games. Vostu counter-claimed that Zynga had copied other games repeatedly over the years. Zynga followed up that lawsuit with another against Google because Orkut (which it owns), was hosting the Vostu games that Zynga claimed were "rip-offs."

After all the public posturing and finger-pointing died down, the two companies came to a mutual understanding, and in December 2011, they agreed to settle the lawsuits filed in the U.S. and Brazil. As part of the settlement, Vostu made a payment of an undisclosed amount to Zynga and changed four of its games. Some point to that payment to Zynga as the probable cause of this fresh round of layoffs, but Vostu gives another answer:

"Vostu grew a significant amount in the last 18 months and is constantly focused on improving efficiency for future growth which includes select and strategic hiring. We are consolidating our game design and development at our new headquarters in Buenos Aires."

Source: TechCrunch

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