Schilling reaches settlement in 38 Studios case
Superior Court Judge Michael Silverstein approved the settlement after hearing from lawyers for both sides: the state's economic development agency and Dallas-based Hilltop Securities Inc. Hilltop was formerly the First Southwest Co., the state's financial adviser on the deal, and agreed to pay $16 million to get out of the case.
The total settlements in the case end up at about $61 million. A number of other parties previously settled, including Schilling and other 38 Studios executives, lawyers and companies that worked on the deal, and officials at the economic development agency.
"It was easy to get started, not so easy to get finished," Max Wistow, who represented the Commerce Corporation, the state's economic development agency, said of the 2012 lawsuit. "We feel like it was worthwhile."
38 Studios moved from Massachusetts to Rhode Island in 2010 in exchange for a $75 million loan guarantee, and then went bankrupt.
Last September, Schilling and others agreed to a $2.5 million settlement to end their part of a lawsuit. Neither he nor the other company officials admitted liability in the settlement, which 38 Studios' insurance company would pay.
Schilling has said his company failed because it didn't raise enough money, not because he did anything malicious or illegal. He also has faulted Rhode Island politicians for giving him a loan guarantee in the first place.
Democratic Gov. Gina Raimondo announced Friday she'll file a petition in court to seek the release of documents from the state grand jury investigation into the deal that never resulted in any criminal charges.
"Now that the civil case and criminal case is closed, we should make all the documents available to the public and give the people of our state closure," Raimondo said in a statement.
Rhode Island Attorney General Peter Kilmartin, also a Democrat, has voiced concerns about releasing investigative records from the case. Raimondo says Rhode Island residents have a right to know what happened.
Rhode Island State Police Col. Ann Assumpico has directed her agency to review and release the non-grand jury documents in their possession, Raimondo said Friday.
Still pending is a U.S. Securities and Exchange Commission lawsuit against Wells Fargo and the economic development agency, accusing them of making misleading statements about bonds used to fund the deal.
The SEC and the economic development agency have entered into a tentative settlement agreement, but they are still awaiting approval from the SEC, Wistow said. He said they're hoping to get that "momentarily." The terms of the tentative agreement haven't been released.
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