Former Red Sox pitcher Curt Schilling’s video game company, 38 Studios, has filed for bankruptcy.
“This action comes after several weeks when the company has reviewed, considered and received the recommendations and advice with respect to potential avenues for relief that are currently available,” 38 Studios told The Providence Journal in a statement. “After ongoing negotiations with the State of Rhode Island and potential investors and other interested parties, the Company has been unable to find a solution to the current stalemate.”
38 Studios relocated to Rhode Island in 2010 in exchange for $75 million in guaranteed loans, and, earlier this year, put out its first game, “Kingdoms of Amalur: Reckoning,” to positive reviews. But things fell apart after the company missed a $1.1 million payment to the state on May 1. The payment was eventually made, but the company was then unable to meet payroll, and Schilling asked the state for more money. Gov. Lincoln Chafee came out publicly against the idea, saying at a press conference that “there’s no more easy money,” and that 38 Studios should seek private money to stay in business. On May 24, 38 Studios laid off all its employees.
Col. Steven G. O’Donnell, superintendent of the Rhode Island State Police, told the Journal today that his agency, the FBI, the U.S. Attorney’s office and the Rhode Island attorney general “are working together to investigate activities that have recently come to light at 38 Studios.”
According to the Associated Press, the bankruptcy was filed in U.S. Bankruptcy Court in Delaware on Thursday.
Eric Lach is a reporter for TPM. From 2010 to 2011, he was a news writer in charge of the website’s front page. He has previously written for The Daily, NewYorker.com, GlobalPost and other publications. He can be reached at ericl(at)talkingpointsmemo.com