Fox Walden, the heavily hyped start-up that was being funded by Fox and Colorado's Anschutz company to make family pictures, is retrenching, according to Variety, after a few films like "Nim's Island" failed to perform as planned.

Jeffrey Godsick, the former Fox public relations guru, had transplanted to handle Fox Walden as the head of marketing for the new venture. Three years later, he's coming back to Fox as executive vice president of marketing and digital content.

At least 12 jobs will be eliminated amidst serious reshuffling of staff, the paper said.

Per Variety, though Fox and Walden had high hopes for the joint venture when it was created in August 2006 to market family films produced by the two companies, there weren't enough pics to warrant a stand-alone marketing entity. In the ensuing two years, only three movies have been released under the logo: "Nim's Island," "Mr. Magorium's Wonder Emporium" and "The Seeker."

Though "City of Ember" will open next week as part of the partnership, there are no films planned for release in 2009.

Walden and Fox will each continue to develop family films separately and will continue to partner as co-financiers on select projects. Among the projects they will team for are the Dwayne Johnson starrer "Tooth Fairy" and "Ramona," which is based on Beverly Cleary's bestselling kid-lit books. Both projects will be overseen by the revamped Fox Walden unit and distributed domestically by Fox.