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Friday, 2 November 2012 - Rhode Island sues Schilling over failed 38 Studios deal |
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The suit was filed in Superior Court on Thursday and listed Schilling, who named the company after his former jersey number, Keith Stokes, the former head of the state's Economic Development Corporation (EDC), several banks and law firms as defendants in the case. EDC, a quasi-state agency, made the loan in 2010 to lure Schilling who was promising to bring 450 jobs to the economically depressed state from neighboring Massachusetts. The deal was brokered by Donald Carcieri, the state's governor until January, 2011. 38 Studios filed for bankruptcy in June leaving the state's taxpayers responsible for repaying roughly $100 million, with interest included, to private investors who had bought the bonds the state issued on behalf of the company. The suit charges that some of the defendants committed larceny and permitted the video game company to rely on financial assumptions that were based on "known false assumptions". Governor Lincoln Chafee, who authorized the suit, issued a video statement saying taxpayers should not be asked to pay for this. "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," Chafee said, adding that the suit was being filed to "rectify a grave injustice put upon the people of Rhode Island". From the beginning, the loan guarantee was highly controversial. Massachusetts failed to give the former Red Sox star, who had helped the hometown team win its first World Series championship in 86 years in 2004, the same loan guarantees. The case is State of Rhode Island Providence, SC v. Wells Fargo Securities, LLC; Barclays Capital, Plc; First : Southwest Company; Starr Indemnity and Liability Company; : Curt Schilling; Thomas Zaccagnino; Richard Wester; Jennifer Maclean; Robert I. Stolzman; Adler Pollock & Sheehan, P.C.; Moses Afonso Ryan ltd.; Antonio Afonso, Jr.; Keith Stokes; and J. Michael Saul, Superior Court. (Reporting By Svea Herbst-Bayliss; editing by Andrew Hay) U.S. Entertainment Fashion Tweet this Link this Share this Digg this Email Reprints   We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.   Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Connect with Reuters Twitter   Facebook   LinkedIn   RSS   Podcast   Newsletters   Mobile About Privacy Policy Terms of Use AdChoices Copyright Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us   Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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