Rhode Island’s lawsuit over failed video game company 38 Studios will move forward. Superior Court judge Michael Silverstein dismissed some of the counts, but allows key parts of the state’s lawsuit to move ahead.
When video game maker 38 Studios went belly up after receiving a $75 million state loan guaranty, it left taxpayers in the lurch for roughly $100 million.
The state sued former company executives, former officials with the state’s Economic Development Corporation, former Red Sox pitcher Curt Schilling, and a collection of lawyers and financial institutions. The 14 defendants tried to get the lawsuit dismissed, but Judge Silverstein went through each count with a scalpel, dismissing some of the counts, or some of the defendants, but allowing key parts of the lawsuit to move forward. This includes counts of negligent misrepresentation, fraud and legal malpractice.
The state claims 38 Studios knew that the $75 million dollars wasn’t enough to keep the company afloat. While company lawyers claim Schilling hid nothing from the state.
Do you have insight or expertise on this topic? Please email us, we'd like to hear from you. firstname.lastname@example.org