Infinity Blade: Dungeons has been put "on hold," and the developer of the third entry in the series, Impossible Studios, is being shuttered according to Epic Games founder Tim Sweeney.
Impossible Studios was formed in August after Epic hired on former members of Big Huge Games after its collapse.
"When former members of Big Huge Games approached Epic last year, we saw the opportunity to help a great group of people while putting them to work on a project that needed a team," said Sweeney today in a statement. "It was a bold initiative and the Impossible folks made a gallant effort, but ultimately it wasn’t working out for Epic.
"In addition to providing Impossible Studios employees with three months of severance pay, we’ll be giving the team the opportunity to form a new company with the Impossible Studios name and the awesome Impossibear logo. This means that Infinity Blade: Dungeons is now on hold as we figure out the future of the project."
In October, Epic announced Infinity Blade: Dungeons would miss its targeted 2012 release. The game was announced alongside iPad 2.