Quantcast
38 Studios declares bankruptcy, investigation begins - Destructoid

DestructoidJapanatorTomopopFlixist



38 Studios declares bankruptcy, investigation begins


6:15 PM on 06.07.2012
38 Studios declares bankruptcy, investigation begins photo



The death knell has sounded for 38 Studios. Following the layoff of its entire 379-person staff two weeks ago after missing a $1.125 million loan payment to Rhode Island, the developer of Kingdoms of Amalur: Reckoning and the Project Copernicus MMO has filed for Chapter 7 bankruptcy, which means that the company is officially no more and its assets will be liquidated. Here's the full statement from a 38 spokesman, as given to the Providence Journal:

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. 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.

The bankruptcy filing comes one day after state and federal officials -- the Rhode Island State Police, Rhode Island Attorney General, Rhode Island U.S. Attorney, and the FBI -- launched a criminal investigation into 38 Studios' finances. Rhode Island State Police Col. Steven O'Donnell told WPRI that they will be looking into "both the money that came from the state as well as the money that came from Bank Rhode Island."

The state funds are the original $75 million loan from the Rhode Island Economic Development Corporation to 38 Studios, initiated in 2010. Bank Rhode Island loaned the company $8.5 million earlier this year, issued against state tax credits that never came to pass. According to O'Donnell, the timing of the investigation and the bankruptcy filing is a coincidence.

Rhode Island officials are hopeful that the state can get some return on 38 Studios' assets, which it now owns. Jonathan Savage, legal counsel to the Economic Development Corporation, told reporters today that the state has had discussions with investors offering upwards of "tens of millions of dollars" for 38's former intellectual property. "We're going to do everything we can to maximize the return on our investment," said Gov. Lincoln Chafee. Here's hoping Rhode Island gets something for its trouble, since the state's taxpayers are on the hook for nearly $90 million through 2020.

Bankrupt 38 Studios will be liquidated [WPRI via Joystiq]
Criminal probe launched into 38 Studios [WPRI]
Schilling's 38 Studios declares bankruptcy; law enforcement investigating [Providence Journal via Joystiq]
38 Studios liquidation valued in tens of millions by RI, gov. will get every penny he can for taxpayers [Joystiq]






Comments not appearing? Anti-virus apps like Avast or some browser extensions can cause this.
Easy fix: Add   [*].disqus.com   to your software's white list. Tada! Happy comments time again.

Did you know? You can now get daily or weekly email notifications when humans reply to your comments.








Win your choice of console from Destructoid! in Destructoid's Hangs on LockerDome

38 Studios

10:15 AM on 12.16.2013
Kingdoms of Amalur wasn't sold at 38 Studios auction

The auction for 38 Studios assets happened, and while the Rise of Legends and Rise of Nations franchises sold for $320,000, no one made a good offer for Kingdoms of Amalur. 38 Studios founder Curt Schilling thinks that the se...more



11:00 AM on 12.13.2013
No one wanted to help Rhode Island be ostriches

Last month, Kyle called Rhode Islanders ostriches for wanting the state to simply not pay the $90 million owed to investors who purchased bonds used to fund Curt Schilling's now-defunct development house, 38 Studios (Kingdoms...more



10:00 AM on 11.30.2013
Curt Schilling: Amalur IP is a 'billion dollar' franchise

There's no denying that Kingdoms of Amalur: Reckoning, was a solid action-RPG. It didn't break the mold by any means, but it was bright, colorful, and served up a satisfying blend of action and loot hoarding. And while I enjo...more



View all 38 Studios






Back to Top




All content is yours to recycle through our Creative Commons License permitting non-commercial sharing requiring attribution. Our communities are obsessed with videoGames, movies, anime, and toys.

Living the dream since March 16, 2006

Advertising on destructoid is available: Please contact them to learn more