I don't think the state will get its money back. This case seems flimsy to me.

Shit. I'm sweating bricks over here just reading about the fate of that company and how much worse it just got, and I'm about as far away from any of it as you can get. Somewhere on the other side of the world, some poor soul who has to sort all of this out must be dying from a heart attack right about now... Not cool. Not cool at all.

SEVEN. HUNDRED. SEVENTY-FIVE MILLION.

MINIMUM

I LIKE BASEBALL. I LIKE EVERQUEST. LET'S MAKE A GAME YOU GUYS!

I think all the states should start making video games.

Im guessing the governor doesnt get the point of unsecured loans

They will probably end up paying the lawyer another 10 million in fees and get about £500,000 back

The litigation is actually quite convenient as it now mean they cant talk about it and it will drag on for many years

@lockload: I think it has more to do with politics rather than finances.

@pekoe212: The thought process would be that they'd bring jobs to RI and get their money back. It all began when wow was at it's peak and raking in crazy money. 38 Studios sold RI on that concept but nobody knew that the wow model exists for wow alone regardless of the IP. After Star Wars, everyone sees that now (GL Elder Scrolls & Fallout.) 38 Studios shares the blame for overspending on talent and even going as far as to buy their employee's mortgages so they could move to RI and work for them.

It's their own damn fault, the Rhode Island Gov shot it in the foot by publicly speaking out against the company while they were in negotiations with EA, from what I recall, completely torpedoing it. Governor, sue thyself.

This is why states shouldn't gamble with tax payer money. Just sayin'

@Nomin said:

Who in their right mind would loan a 75 million dollar grant to one game studio?

This is how some people approach economical development. Pay companies to come in and do business in your state who would otherwise never bother because of the tax situation. We do the same thing here in CT. Sometimes it works, usually it doesn't. It helps when the people making the decisions are actually competent and responsible with tax payer money (which again, usually they aren't).

It's a political move designed to make the governor look strong on the economy and claim he/she "created" jobs when really they were just handing out tax payer money. Kinda like a bribe. Makes me wonder "hey, how about instead of paying companies to come to your state, you set up a tax code that makes them WANT to come..." but that's neither here nor there.

Anyway, Chafee needs to do this to save his own ass now. Next election he can't have the ads saying he threw away $75m away on a failed videogame company.

So the govenor's administration fucks up, giving money to a business it shouldn't have, then does the kind of homework it should have done in the first place and tries to divert the blame. Am I getting this right? Or was a previous administration responsible for the loan?

@Zohar said:

Anyway, Chafee needs to do this to save his own ass now. Next election he can't have the ads saying he threw away $75m away on a failed videogame company.

Chafee's predecessor was the guy who arranged this deal, and as I recall, Chafee ran against the 38 Studios thing when he ran for governor. So I don't think he'll get blamed from the $75 million loss anyway.

example 3502 why the government should not loan money to businesses.

You wouldn't know it by the framing of the shot, but the governor is indeed a Hobbit.

I agree that this looks pretty scapegoaty but I can't shake the feeling that if this was a company like Microsoft, Zynga, EA or Activision we would all be saying "Hellz yeah stick it to those greedy, cheating bastards. They dropped the ball hard and deserve what's comin to them!". Alex included.

I don't see the problem here. granted, it's very sad for 38 studios that this is happening, but maybe if they had reined in their ambitions a bit, this wouldn't have happened.

If you would have told me 8 years ago that Curt Schilling would have bankrupted the state of Rhode Island by developing a video game I would have called you a madman.

@WMoyer83 said:

If you would have told me 8 years ago that Curt Schilling would have bankrupted the state of Rhode Island by developing a video game I would have called you a madman.

Haha very true.

@Cold_Wolven said:

Well this pretty much ensures that from now on no company whether it be a game development studio or anything for that matter will want Rhode Island as an investor. The more this Governor chases this lawsuit the more he is shooting Rhode Island in the foot.

How is that shooting themselves in the foot?

@KevinK said:

@Zohar said:

Anyway, Chafee needs to do this to save his own ass now. Next election he can't have the ads saying he threw away $75m away on a failed videogame company.

Chafee's predecessor was the guy who arranged this deal, and as I recall, Chafee ran against the 38 Studios thing when he ran for governor. So I don't think he'll get blamed from the $75 million loss anyway.

Yep. And that's precisely the reason he's gung-ho after 38 Studios and Curt Schilling. He was against it from day one, indirectly caused 38 to go broke by outing their situation without warning, and is now trying to get anything he can from them.

@namesonkel said:

You wouldn't know it by the framing of the shot, but the governor is indeed a Hobbit.

And I can't help but feel he looks remarkably like Richard Dakwins...

So the guy who sparked the death of this already troubled game now wants to sue because of his own state's incompetence?That's fair. Curt Schilling should be able to sue him for frivolous lawsuits. If that dumbass kept his mouth shut 38 studios might've been able to dupe one more investor, piddle out this game and repay a small portion of that $75 million, which is honestly more than they deserve.

@damnable_fiend said:

I don't see the problem here. granted, it's very sad for 38 studios that this is happening, but maybe if they had reined in their ambitions a bit, this wouldn't have happened.

By "reined in their ambitions," I take you mean not develop a dying genre with a dying subscription model. That's about as ambitious as they ever got. Traditional MMORPGs die because the gameplay is terribly antiquated, the subscription is way too expensive and not worth the value and in this case added nothing to the already terribly saturated fantasy aesthetic. I think Rhode Island should have done some research themselves because minimal foresight could've seen this coming from miles away.

I'm not really well versed in the deals that have been set p by these parties and such but isn't it normally a case of "tough shit" for entities losing money via bad investments?

The whole idea behind incorporating is to shield the employees from creditors. Seems to me that this is a really slimeball move by politicians to try and win votes, and to try and find loopholes to get around this. The real winner here, is going to be the lawyers.

38 Studios is guilty of making some unwise decisions, sure, but I dont think there was some sort of conspiracy behind the deal. I think RI actually approached 38 about economic development loans. The economic development corporation, and the government backing it, should have done more research into the video game industry and the people behind 38 Studios before extending them loans.

Honestly they won't get much of anything at all. They would have to prove that there is some sort of fraud. This guy did harm to the company instead of letting the game come out. With no product they pretty much screwed themselves. I am pretty sure everyone involved would be protected by the company (assuming 38 Studios was an LLC). The state will have to pay more money in court to prove that there was fraud. I havn't heard anything and if it was the state and they knew this, they would have charged the parties involved. Also... it is Rhode Island. WTF? And the Governor can't afford an HD camera?

@bingbangboom said:

Honestly they won't get much of anything at all. They would have to prove that there is some sort of fraud. This guy did harm to the company instead of letting the game come out. With no product they pretty much screwed themselves. I am pretty sure everyone involved would be protected by the company (assuming 38 Studios was an LLC). The state will have to pay more money in court to prove that there was fraud. I havn't heard anything and if it was the state and they knew this, they would have charged the parties involved. Also... it is Rhode Island. WTF? And the Governor can't afford an HD camera?

You think the Governor can't buy a judge?

Everybody who worked at that company is going to prison, one way or another.

Schilling is an idiot. He didnt start 38 because he had a great idea for a game that would be cost effective and could be done with managed risk, he did it because he's a WoW freak and thought it would be neato to make something like that. The MMORPG market is next to impossible to break into. If EA, Bioware, and Lucasarts can barely do it, why would Schilling think he could? It's honestly painful for me to see the guy lose his fortune over this, and for RI to get saddled with this mess, but they all deserve it. This thing had disaster written all over it from the start. The people of RI have every reason to be furious over this debacle

@Daemonocracy said:

Lincoln Chafee is just covering his own political ass. He is the embodiment of a soulless politician with no concrete principles or values that drive him other than his own self preservation. Chafee is scum and this futile lawsuit will accomplish nothing but cost the taxpayers even more money. This is what happens when governments invest in private companies, the public sector does not weigh risk versus reward as efficiently as the private sector because it's not their money they are gambling/investing with.

Schilling is no businessman, he's a baseball player and a gamer who just wanted to get into the business he loves after leaving the sport he loved. According to every employee account I have read, they loved working at 38 studios and ended up making a promising new IP in Amalur.

What is the lesson in all of this? Businesses need to stay OUT of Rhode Island, especially gaming companies. Go to Texas where the game industry is booming these days.

@Terramagi said:

The next logical step is arresting the ex-employees and giving them lengthy prison sentences.

That'll teach those fuckers.

You can't send someone to jail with a civil claim.

You guys should read a Law for Dummies manual or something.

The strapline of this news article is confusing. It makes it sound like the state of Rhode Island is suing itself. :P

@jmrwacko said:

@Terramagi said:

The next logical step is arresting the ex-employees and giving them lengthy prison sentences.

That'll teach those fuckers.

You can't send someone to jail with a civil claim.

You guys should read a Law for Dummies manual or something.

I don't think you grasp how absolutely fucked the American legal system is.

The guy deliberately sabotages the company, shuts it down, and is now suing them for hundreds of millions of dollars for the company shutting down. I would honestly be surprised if this doesn't end with somebody being mysteriously shot to death by police.

@TurboMan said:

I love Ryan's deep sighs when trying to wrangle Leigh into some sort of order.

How the hell can there possibly be any money to get back unless its in assets.

Oh, I am soooo sorry, but when I was watching the governor's video, the way his head was framed reminded me of this:

@Terramagi said:

@jmrwacko said:

@Terramagi said:

The next logical step is arresting the ex-employees and giving them lengthy prison sentences.

That'll teach those fuckers.

You can't send someone to jail with a civil claim.

You guys should read a Law for Dummies manual or something.

I don't think you grasp how absolutely fucked the American legal system is.

The guy deliberately sabotages the company, shuts it down, and is now suing them for hundreds of millions of dollars for the company shutting down. I would honestly be surprised if this doesn't end with somebody being mysteriously shot to death by police.

You seem a bit paranoid, friend.