The second of two scheduled auctions of property belonging to failed video-game company 38 Studios will be held Tuesday in Providence, R.I.
SJ Corio Co., a Warwick, R.I., company handling the auction, expects to sell more than 1,800 items and might extend the auction for a second day. It is scheduled to start at 10:30 a.m. at One Empire St. in Providence.
38 Studios, founded by former Boston Red Sox pitcher and current ESPN baseball commentator Curt Schilling, filed for Chapter 7 liquidation in June. Its demise left Rhode Island taxpayers on the hook for about $110 million in bonds, including interest, because the Rhode Island Economic Development Corp. backed a loan guarantee two years ago with the state's moral obligation.
Gov. Lincoln Chafee, state Treasurer Gina Raimondo and revenue Director Rosemary Booth Gallogly say the state should honor the debt.
But House Speaker Gordon Fox, who represents the East Side of Providence, and his November opponent, independent Mark Binder, say Rhode Island should consider defaulting on it. "It's an option," Fox said Friday during a debate on WPRI-TV's Newsmakers program, co-hosted by WPRI's Tim White and Ted Nesi, and Rhode Island public radio political reporter Ian Donnis.
According to Providence attorney Richard Land, the receiver for 38 Studios, last week's auction in Timonium, Md., generated $180,000 on the sale of items that included furniture, computers, office equipment, gaming consoles and televisions.
"In my experience, [the first] auction can be considered robust. Having this many bidders helps to extract greater value for the property," said Land, a partner at Chace Ruttenberg & Freedman LLC whom Rhode Island Gov. Lincoln Chafee appointed receiver in August after a U.S. Bankruptcy Court judge transferred the case from Wilmington, Del., to Rhode Island Superior Court.
Several RIEDC board members, including Keith Stokes, resigned after the story broke.
While the U.S. attorney's office for Rhode Island said it would not file federal charges against the company, the Rhode Island state police are still investigating the matter. In addition, the RIEDC established a subcommittee to examine its legal options.
A study by the Rhode Island Public Expenditure Council urged the reduction of the RIEDC's powers and the creation of a commerce secretary to coordinate business development in the state.