Everyone at blizzard north was fired.

Michael Dashow Leaves Blizzard - Flux [22:23:PST]

Michael Dashow, an artist who did a great deal of the original character design (Sorc and Barb) and tons of other artwork for Diablo II, maintains his own website. His last art project to be released by Blizzard is the new v1.11 Lilith/Andariel wallpaper, and if you check out the D2 artwork section of his page you can see a bit more info about the painting.

My last Blizzard desktop: I was asked to come up with something cool for the Diablo 1.11 patch, possibly something with Andariel... "Be sure to make her sexy but not TOO sexy, if you know what we mean..." I knew what they meant. Phil Shenk's original design for Andariel is basically topless, a fact that's easily overlooked when she's at screen resolution in the game but is harder to conceal in a giant desktop. Fortunately there were also some redesigns of a PG-13 version of the character done for the possibility of making an Action Figure, and I checked those out to get some ideas on... um... mammary concealment.
Anyhow, you can see the full piece at the Blizzard website here.

This desktop was released the same day as the Diablo 1.11 patch, and the same day that the entire staff of Blizzard North was let go. And two weeks after I fortuitously resigned from Blizzard Entertainment. So that about wraps it up for this page...!

And yes, he said that everyone at Bliz North was fired. Technically, they were offered "relocation packages," meaning they could choose to move to the smoggy hellhole that is Irvine and work in cubicles at Blizzard HQ, or they could stay in the Bay Area and find work elsewhere. Feel free to insert your own, "Another 2 year delay in D3 development." gloomy thought here. Thanks to Jonas for the news tip.

From diabloii.net