Curt Schilling (Credit: Jared Wickerham/Getty Images)
A U.S. Bankruptcy judge has given The Rhode Island Economic Development Corp. and Bank of New York Mellon Trust Co. the go-ahead to take 38 Studios' assets -- specifically, the IP for its games.
As you might expect, the governor has no interest in making a video game of his own, meaning the state and bank plan to look for a buyer to the rights for Kingdoms of Amalur: Reckoning and the in-development online game Copernicus.
Assuming they're successful, the money raised from that sale would go to repay some of the $75 million loan made to the studio founded by the former Boston Red Sox pitcher. 38 Studios filed for Chapter 7 bankruptcy in June after laying off all of its employees.
So why now? The state and bank (which is the trustee for the loan) told the court they needed to take action quickly before "all or substantially all of the intellectual property could be irretrievably lost."
Don't expect the rights to those games to come anywhere close to paying off 38 Studios' tab. Kingdoms of Amalur was, at mid year, the industry's tenth best selling game, but that's only because retail sales have been pretty dreadful this year. The title reportedly sold 1.2 million copies in the first 90 days, but it needed to sell up to 3 million to break even.
Copernicus, meanwhile, is an untested (and unfinished) property, which means it's probably not worth much at all. Three years ago, when longtime game publisher Midway collapsed, its receivers only pocketed $33 million for three very famous IPs: Mortal Kombat, Joust, and Spy Hunter.
The 38 Studios implosion has been frustrating for Rhode Island taxpayers, who have been left on the hook for the loan on which Schilling defaulted. State officials lobbied hard in 2010 to lure 38 Studios away from its original home in Massachusetts.
Despite the mutter of some skeptics at the time, then-Governor Donald Carcieri said when announcing the deal "This is a risk worth taking."
Schilling has said the studio's failure will cost him $50 million personally.
- Video Games
- Arts & Entertainment
- 38 Studios