Star Wars: First Assault and Star Wars 1313 are cancelled, however Star Wars 1313 can still be saved with licensing (here's your chance Obsidian). Disney will still use the LucasArts name to license games, but the studio is no more.
An exerpt from Disney's statement:
“After evaluating our position in the games market, we’ve decided to shift LucasArts from an internal development to a licensing model, minimizing the company’s risk while achieving a broader portfolio of quality Star Wars games. As a result of this change, we’ve had layoffs across the organization. We are incredibly appreciative and proud of the talented teams who have been developing our new titles.”
Disney acquired LucasArts last fall and ever since then rumours began of LucasArts enacting a hiring-freeze and holding off on project announcements; which many staff saw as the beginning of the end. Today, it's official: the studio that brought Jedi and Sith so many adventures and much entertainment is no more.
May the Force be with all of the staff and their families. We wish them luck in their futures.
I hope this is worth it to Disney because this action is certain to turn long-time fans to the Dark Side; myself included. I was/am extremely excited for 1313 and I wish for it to be picked up by a studio with Star Wars experience. It is sad to see such a great studio end so abruptly.