Judge says records will be unsealed in 38 Studios lawsuit, including officials' depositions

MarketsAssociated Press

All records will be unsealed in the lawsuit over Rhode Island's failed $75 million deal with ex-Boston Red Sox pitcher Curt Schilling's video game company 38 Studios, a judge ruled Friday.

Superior Court Judge Michael Silverstein said the parties have agreed that the files will be made public because discovery is complete. He said he hopes that happens within 10 days.

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Silverstein also is considering whether to approve a partial settlement in the lawsuit filed against Schilling and others in an attempt to recover at least some of the money Rhode Island stands to lose because of the state loan guarantee it promised the company to move from Massachusetts to Rhode Island.

The records include depositions of officials including Gordon Fox, who was House Speaker when the deal was made in 2010, and former Gov. Donald Carcieri, who served as chairman of Rhode Island's economic development agency, the Economic Development Corporation.

The EDC has since been renamed the Rhode Island Commerce Corporation. Fox was sentenced on unrelated corruption charges in June.

Max Wistow, who represents the Commerce Corporation, said outside of court Friday that he's "absolutely pleased" by the judge's decision. He said he pushed to release the documents because of the public outcry over the failed deal, and to ensure as much transparency as possible in the case.

Democratic state Sen. James Sheehan, who watched the proceedings, said the public doesn't trust public officials, and he hopes that shining a light on the 38 Studios case would "clear the air."

Schilling's company went bankrupt in 2012, leaving taxpayers on the hook to repay bonds that had been issued to fund the move. The EDC sued Schilling and 13 executives of his company, former agency employees, investment banks and others over the collapse, alleging fraud, negligence and breach of fiduciary duty, among other things.

Wistow said there are now "thousands and thousands and thousands and thousands of pages" of documents in the case. Court spokesman Craig Berke said the court's staff is working to figure out how to release them.

The Commerce Corporation has agreed to a $12.5 million proposed settlement with four defendants, including the agency's former top leaders.

Schilling and several remaining defendants object to the proposed settlements. The full reasoning for their objections is under seal.

Silverstein previously approved a $4.4 million settlement between the agency and lawyer Antonio Afonso Jr. and his firm, Moses Afonso Ryan, which worked on the sale of the bonds that financed the deal.