Schilling's video gaming co. files for bankruptcy

View photos
FILE - In a Monday, May 21, 2012 file photo, former Boston Red Sox pitcher Curt Schilling, center, is followed by members of the media as he departs the Rhode Island Economic Development Corporation headquarters in Providence, R.I. Schilling and Rhode Island's economic development agency met Monday to discuss the finances of his troubled video company. (AP Photo/Steven Senne, File)

PROVIDENCE, R.I. (AP) — Former Red Sox pitcher Curt Schilling's troubled video gaming company, lured to Rhode Island with a $75 million loan guarantee from the state in 2010, filed for bankruptcy protection on Thursday, potentially setting up taxpayers to pay at least some of its debts.

The filing by Providence-based 38 Studios was made in U.S. Bankruptcy Court in Delaware, where the company is incorporated as a limited liability corporation.

Court filings show the company owes between $100 and $500 million, while its assets are estimated at between $10 and $50 million.

A second filing was made by 38 Studios Baltimore, a separate limited liability corporation. It owes between $100 and 500 million, and has assets between $500,000 and $1 million, the filing shows.

38 Studios was lured to Providence from Massachusetts in 2010 when Rhode Island officials offered a $75 million loan guarantee they said would bring hundreds of jobs and millions of dollars in tax revenue. The state is likely to be on the hook for some of the company's debts.

A message was left for Schilling.

The firm last month laid off its entire workforce, including nearly 300 employees in Providence and more in Maryland. That move came after 38 Studios was more than two weeks late on a $1.1 million payment to the state — the first indication, state officials have said, that the firm was in financial trouble.

Christine Hunsinger, a spokeswoman for Gov. Lincoln Chafee, on Thursday described the filing as "expected."

"He was well aware that this was one of the possible outcomes," she said.

Hunsinger said she didn't immediately know what impact the company's bankruptcy filing would have on the state.

The state recently selected an outside auditor to review the finances of Schilling's company.

Judy Chong, a spokeswoman for the Rhode Island Economic Development Corp., whose board approved the loan guarantee in 2010, could not immediately be reached for comment.

The executive director of the agency resigned last month, along with several board members, after the company's troubles came to light.


Associated Press writers Laura Crimaldi and David Klepper contributed to this report.