38 Studios lawsuit draws subpoena from SEC

Securities and Exchange Commission serves papers to group responsible for green-lighting $75 million loan that brought Curt Schilling's game company to Rhode Island in 2010.

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The United States Securities and Exchange Commission, the federal agency responsible for enforcing securities laws, has subpoenaed the Rhode Island Commerce Corporation for information related to the ongoing lawsuit against Curt Schilling's failed development outfit 38 Studios.

Image credit: Steven Senne, AP

Two lawyers confirmed the subpoena this week to The Providence Journal. The SEC originally requested depositions and exhibits related to the lawsuit in December, the paper reports.

The Rhode Island Commerce Corporation is the new name for the Rhode Island Economic Development Corporation (EDC), which orchestrated the controversial $75 million loan guarantee that brought 38 Studios to Rhode Island in 2010.

38 Studios went belly up in May 2012, leaving taxpayers on the hook for an estimated $100 million. The state of Rhode Island sued Schilling and other architects of the loan in November 2012, while the SEC investigation commenced in September 2013.

The Providence Journal reports that depositions in the lawsuit have begun, but only one has been completed so far--that of former EDC deputy director J. Michael Saul.

Efforts to recoup losses related to 38 Studios, including a liquidation auction of the company's assets last month, have gathered a lackluster response so far. Sequel rights to Kingdoms of Amalur: Reckoning and rights to the Project Copernicus MMO failed to sell, with Rise of Nations and Rise of Legends fetching a total of just $320,000 from an unspecified buyer.

After Project Copernicus found no buyer, Rhode Island governor Lincoln Chafee said the game now represents nothing more than "a lot of junk."

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