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38 Studios Pays the State But Not Its Workers

| 17 May 2012 21:25
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The beleaguered 38 Studios was unable to make payroll this week and has reportedly fired all temp and contract workers.

The crunch appears to be coming to Curt Schilling's 38 Studios, which is "in the process" of making an overdue payment of $1.125 million to the Rhode Island Economic Development Corporation but, because of that, cannot meet its payroll obligations for the week. According to WPRI, employees at the studio "looked glum" but could not comment on whether or not they'd been paid this week.

Sources have told Joystiq that the Kingdoms of Amalur developer has also terminated the employment of all temporary and contract workers.

It was revealed last night that Schilling, a former Boston Red Sox ace who founded the company as Green Monster Games in 2006, had asked officials with the Economic Development Corporation for more money to keep the studio afloat. How much he asked for wasn't revealed, and the RIEDC has yet to act on the request.

Rhode Island offered 38 Studios $75 million in loans to relocate from Massachusetts in 2010, nearly $50 million of which has thus far been granted. Why the studio is struggling so badly in the wake of the reasonably-successful release of Kingdoms of Amalur: Reckoning is a bit of a mystery, but the loan money is [or was] apparently being used to finance the ongoing development of its other project, an MMO currently known only as "Project Copernicus." If the company collapses, residents of the state will be on the hook for the debt, which with interest could end up totaling more than $100 million.

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