PROVIDENCE — A law firm sued by Rhode Island’s economic development agency over the failed $75 million deal with former Boston Red Sox pitcher Curt Schilling’s video game company has agreed to settle for $4.4 million, the sides said in a court filing Friday.
If approved by a judge, it would be the first settlement in the high-profile lawsuit over 38 Studios. The deal has cast a shadow over Rhode Island politics ever since the company went bankrupt two years ago, leaving taxpayers on the hook for as much as $100 million. The lawsuit was filed in 2012 against Schilling and others as an attempt to recover some of that money.
The settlement agreement between the agency formerly known as the Economic Development Corp. and lawyer Antonio Afonso and his firm Moses Afonso Ryan was filed with Superior Court Judge Michael Silverstein. Court spokesman Craig Berke said the judge will have a hearing on it July 7.
38 Studios moved to Rhode Island from Massachusetts in 2010 with the promise of a $75 million state loan guarantee. But it was never able to raise the money it needed to survive and declared bankruptcy in 2012. The lawsuit alleges defendants misled the state into approving the loan guarantee.