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38 Studios won't face federal charges

The U.S. Attorney's office has confirmed that it is no longer pursuing any federal action against 38 Studios, though Rhode Island state officials are still checking into the matter.

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38 Studios is deceased in all but name, but at least Curt Schilling's failed video game start-up won't be facing federal criminal charges. A spokesperson for the U.S. Attorney's office has said that it is not planning to pursue any further federal action against the company.

The statement was given to the Associated Press (via Gamasutra), putting the federal matters to rest. The Attorney's office had been investigating if the company had committed any federal crimes while attempting to keep the company solvent.

That should serve as some relief for 38 Studios, but the company isn't out of the woods yet. It's still under investigation from the Rhode Island State Police into whether it broke any state laws, which says it is following "all leads that are presented to us." Meanwhile, Rhode Island Economic Development has hired on a law firm to check into the possibility of financial liability.

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  • reply
    October 1, 2012 10:30 AM

    Steve Watts posted a new article, 38 Studios won't face federal charges.

    The U.S. Attorney's office has confirmed that it is no longer pursuing any federal action against 38 Studios, though Rhode Island state officials are still checking into the matter.

    • reply
      October 1, 2012 11:08 AM

      Wow, so they're not even prosecuting for a WARN Act violation? Under that act, companies undergoing mass layoffs must provide 60 days of notice. 38 Studios laid off everyone via email in late May.

      • reply
        October 1, 2012 12:28 PM

        That might end up being a state thing because I think the WARN act can differ state by state, for example I think NY is 90 days instead of 60.

      • reply
        October 1, 2012 1:41 PM

        From the WARN Act:

        Reduction of notification period
        (1) An employer may order the shutdown of a single site of employment before the conclusion of the 60-day period if as of the time that notice would have been required the employer was actively seeking capital or business which, if obtained, would have enabled the employer to avoid or postpone the shutdown and the employer reasonably and in good faith believed that giving the notice required would have precluded the employer from obtaining the needed capital or business.

        It sounds like this might have been the case for 38 Studios. I'm not sure how that works administratively, but there are genuine circumstances where the notification period would interfere with attempts to save the company.

        • reply
          October 1, 2012 2:11 PM

          That is illuminating! But, it doesn't fit the "every big corp (except Apple) is inherently evil" inference in these kinds of stories.

        • reply
          October 1, 2012 7:36 PM

          I guess that meshes with the "We were talking to EA about funding, when all of the sudden, Lincoln Chafee opened his big fat mouth" line.

      • reply
        October 1, 2012 4:23 PM

        Wouldn't look really good anyway...considering..

        http://money.cnn.com/2012/09/28/news/economy/spending-cuts-fiscal-cliff/index.html