I think the reason they did this is pretty clear; they couldn't make CryEngine's multiplayer framework really function with a huge MMO with seamless transitions across systems. Cryengine was crapping out sending data about trash cans from one side of the sector to the other. The servers can only handle, max, what, like 10-24 players or something?
Lumberjack is probably tied into Amazon Web Services in some way. At least, that's what I see from standing over here. So this move is probably going to involve taking all of the content they made, systems they wrote, animation calls, etc, and porting them to Lumberjack. Since the two engines use the same underlying rendering and data structures (as I understand it), this could be a very easy process. It could not be. It's a risky maneuver, at this late stage in the game, but probably a necessary one.
This is because given this project's track record, of growing from one promise to the next, I don't think they really used a lot of that starting cash efficiently. I bet a lot of it's gone now. However, I, for one, intend to download Star Marine and have a laugh at its expense. I backed when they said they were going to base the flight model on the physical location of the thrusters. Something that I think has been totally forgotten, as evidenced by the extremely detailed but vaugely unrealistic and pointless ships they've been churning out.
Keep in mind that Elon Musk's total initial investment in SpaceX was $100 million, + $20 million right before launch, which means someone else has built a real rocket to launch a real spaceship for less money than it's taking Chris Roberts to get to release candidate 1.0 of Star Citizen.
Source:
https://en.wikipedia.org/wiki/SpaceX
In January 2005, SpaceX bought a 10% stake in Surrey Satellite Technology.[30] By March 2006, Musk had invested US$100 million of his own money into the company.[31]
On August 4, 2008, SpaceX accepted a further $20 million investment from Founders Fund.[32][36][37]
The first privately funded, liquid-fueled rocket, the Falcon 1, then launched into space the very next month in September 2008.
So yea, I think this whole thing will be a demonstration of hubris and of one man's desire to make the next Star Wars, and forgetting to make the game he told people he would.