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Work on the game took a serious knock last autumn, Eurogamer sources say, when several senior members of the development team were forced to take a month away from the pressure of the project's heavy workload.
These project members then returned, but Scalebound was now behind schedule. With continuing issues surrounding the game's engine and overdue deadlines, the decision was made that the project could no longer continue.
Almost sounds like Platinum wasn't ready for such a large endeavor, honestly. After all of the money MS dumped into this project in the last 2+ years I'm sure this didn't go over well and probably burned bridges immediately. Wish there were more details on this. So yeah, not ready to pull out the pitchforks on MS just yet.
Situation obviously sucks though. hhhmmmph