IIRC they were negotiating a startup funding round that failed, so they ended unexpectedly up not having enough money to run the company let alone pay for the tablet manufacturing. Even remember hearing about the manufacturers selling the units with Android by the time they secured at least some funding for the company, so there was really nothing to salvage.

Or it might have just been their excuse back then - if you have some newer details of how it actually all went down with the tablet, please do share! :-)