Flagship CVO David Brevik dismissed the rumors as exaggerated and inaccurate, noting that the company currently employs over 100 workers at its two studios, and has seen less than 10% turn-over in its workforce.
"As is typical in the industry, after a game is released some people naturally want to work on something else and they leave the company to do so," Brevik said in a statement posted on the Hellgate forums.
Reports of a staff exodus stemmed from a blog post written by Flagship programmer Guy Somberg, who claimed that members of the staff were leaving "in droves" after the poor reception of Hellgate: London. Brevik acknowledged the game's tumultuous launch, but said that Flagship's outlook on the title has since improved.
"We will be the first to admit that Hellgate: London did launch with some problems. The game would certainly have benefited from a couple more months in the oven," Brevik added. "Thankfully, after some very hard work... the game is much better now and we believe in the future of Hellgate.
Flagship's San Francisco studio is currently working on ongoing content updates for Hellgate: London, while its Seattle branch is developing the free-to-play MMO Mythos.
"We are putting all of our efforts into these projects and I think it will show in the upcoming Hellgate Abyss Chronicles," Brevik concluded.