Curt Schilling Sued By Rhode Island Over Bankrupt 38 Studios
The former Boston Red Sox pitcher, who ploughed $50 million of his own cash into 38 Studios, saw the company go under on June 7.
Yet Rhode Island is now suing Schilling and several of 38 Studios’ former members in relation to the $75 million loan guarantee provided to the firm by the Economic Development Corp. (EDC) of Rhode Island.
38 Studios was tempted to set up base in Rhode Island’s capital, Providence, with the promise of hundreds of jobs and millions of dollars in tax revenue.
But when the company went under earlier this year, the state itself suffered a loss on its investment that could total more than $100 million. Speaking in a video statement, Rhode Island governor Lincoln Chafee said:
“My message to Rhode Islanders is this: I know that you work hard for your paychecks, and for your tax dollars to be squandered is unacceptable. The Board’s legal action was taken to rectify a grave injustice put upon the people of Rhode Island.”
All staff at 38 Studios were laid off by Curt Schilling in May after the company was late on the repayment of a $1.1 million loan payment to the EDC. Within a fortnight, the game developer had filed for Chapter 7 bankruptcy, leaving more than 1,000 unpaid creditors in its wake.
The only game produced by 38 Studios, Kingdoms of Amalur: Reckoning, was praised by many critics but failed to set tills ringing at retail.