Schilling calls suit political, denies wrongdoing

The Rhode Island Economic Development Corp. on Thursday sued Schilling, some of its former employees and others, saying they committed fraud and other acts that misled the state into approving the deal. 38 Studios laid off all its employees and declared bankruptcy earlier this year.

In his first public comments on the lawsuit, Schilling, in a written statement sent Friday to The Associated Press, said the EDC's decision was made "with its eyes wide open and with full understanding of any risks."

Schilling said he had not yet seen the lawsuit, but believes he's being sued in part because of critical comments he made about Gov. Lincoln Chafee's handling of the situation.

The deal with 38 Studios was struck in 2010, under the leadership of former Republican Gov. Don Carcieri. Chafee, an independent, was harshly critical of the deal as a candidate, but said he wanted to see the company succeed once he became governor.

Schilling has accused Chafee of not doing enough to help 38 Studios stay afloat and publicly called him a "buffoon" and a "dunce of epic proportions." Chafee opposed giving the company more financial support after it began having money troubles, saying it did not have a viable plan for survival.

"I am confident that when the claims against me are adjudicated, it will be determined that the claims were brought against me for political reasons, not based on any alleged wrongdoing on my part," Schilling said in the statement.