Updated March 23 at 7:53pm

Reports: 38 Studios lays off entire staff


(Updated, 7:19 p.m.)

PROVIDENCE - Former Red Sox pitcher Curt Schilling's video game company has laid off its entire staff in the wake of financial difficulties, according to multiple media reports.

The Associated Press reported that 38 Studios sent employees an email notifying them of the "nonvoluntary and nondisciplinary" layoffs on Thursday.

Earlier this week, Gov. Lincoln D. Chafee announced that 38 Studios, which was lured to Providence with a state $75 million loan guarantee, had laid off an undisclosed number of workers after missing payroll last week.

At a Statehouse news briefing scheduled before news broke of the reported layoffs of close to 400 staff members in Providence and Maryland, Chafee said neither he nor anyone on his staff had been told by the company that there had been mass layoffs.

"This is the crux of the communications issue we have been having with the company," Chafee said. "It is not a good situation."

Bill Thomas, 38 Studios' chief operating officer, told Providence Business News he could not confirm that there have been layoffs.

“I can’t comment. I wish I could,” he said. “I am sorry.”

Chafee said the state has offered the company the assistance of a rapid-response team from the Department of Labor and Training to assist employees in the event of mass layoffs.

"They said they would get back to us tomorrow," said DLT Director Charles Fogarty, who attended the Statehouse briefing.

38 Studios managed to make an overdue $1.125 million payment to the state on Friday.

The $1.125 million guarantee fee, which is 1.5 percent of the outstanding loan amount, was due May 1.

Fallout from 38 Studios' apparent demise continued on Thursday.

CVS Caremark Corp. Executive Vice President Helena B. Foulkes resigned as vice chairwoman of the R.I. Economic Development Corporation board of directors.

In an afternoon e-mail statement announcing the resignation, she said it came in response to recent conversations with Chafee about his vision for the EDC’s future.

Chafee said he did not ask for her resignation but also was not surprised by it.

"We've had different philosophies on the board," he said. "We're evaluating the concept of an independent agency." He added he'd like to see the agency structured in a way that has it "more closely aligned with the governor."

He said two other board members, Dr. Tim Babineau, president and CEO of Rhode Island Hospital and The Miriam Hospital; and Dan Sullivan, Jr., president and CEO of Collette Vacations, Inc., would not be reappointed. Their two-year terms expired Feb. 1.

Last week Keith W. Stokes resigned as EDC director following 38 Studios' failure to meet the May 1 payment deadline. He said the resignation was a mutual agreement with Chafee.


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Well, didn't this turn out great for the taxpayers.

Thursday, May 24, 2012 | Report this
Small Business

This is what happens when amateurs (government bureaucrats) and amateurs ( a baseball player) meddle in business. RIEDC needs some hard-driving businnespeople who expect results and who are conscious of cost control. They don't need more Board members or Directors from large corporations or another RI insider.

Why isn't Curt Schilling putting his own personal assets on the line to save his company?

Friday, May 25, 2012 | Report this

This deal was doomed from the very beginning. Let's close down the EDC, get the gov't bureaucrat, who think they know what is best for us, out of the way, and let "true" capitalism operate, not this so-called crony capitalism. As a small businessman, I could never get a "sweetheart" deal as Schilling has. He should have taken all the risks and not me! Because of his inability to run a business, I now will have to assume his losses. Who assumes the losses when I make a mistake!? ME! There are always unintended consequences when gov't get involved in things that they should't. This is fascism, pure and simple. It doesn't work on the federal level and certainly, doesn't work on the state level. I hope RIers have learned their lesson.

Friday, May 25, 2012 | Report this
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