Rhode Island Commerce Corporation Reaches $2.5 Million Dollar Settlement with Schilling, Zaccagnino, Wester, and MacLean in 38 Studios Lawsuit


Deal would bring total settlements so far to approximately $45 million in ongoing 38
Studios litigation

Commerce Corporation remains engaged in litigation against First Southwest Company

PROVIDENCE, R.I. (September 19, 2016) – The Rhode Island Commerce Corporation
announced today it has agreed to a $2.5 million proposed settlement with Curt
Schilling, Thomas Zaccagnino, Richard Wester, Jennifer MacLean, and their insurer,
Starr Indemnity and Liability Company, in the 38 Studios litigation. The settlement
was filed in Rhode Island Superior Court today and is contingent upon court
approval. If the Court approves the settlement, the Corporation will have obtained
settlements totaling approximately $45 million in the ongoing 38 Studios litigation,
over half of the roughly $88 million state moral obligation on 38 Studios bonds for
both past and future appropriations.

The settlement is a product of a court-ordered mediation conducted by retired
Superior Court Justice Francis J. Darigan, Jr. and the efforts of our counsel in the
38 Studios Litigation, Max Wistow, Stephen Sheehan, and Benjamin Ledsham. Judge
Darigan will brief members of the media today at 11:00 a.m. in Courtroom 12 at
Providence Superior Court.

The law firm of Shechtman Halperin Savage, LLP, which serves as general counsel to
the Corporation, determined that the recoverable assets on any judgment entered
against the defendants in the litigation, including any remaining insurance
coverage, would be expected to be less than $2,500,000. The firm reached this
conclusion after a comprehensive and detailed analysis of the assets of the
individual defendants. Accordingly, the proposed settlement is more than the
Corporation can reasonably expect to recover even if the Corporation prevails
against these defendants at trial, and has the additional advantage of certainty.

The Corporation previously settled claims against Wells Fargo Securities, LLC and
Barclays Capital Inc. for $25.625 million in August 2016, Antonio Afonso, Jr. and
Moses Afonso Ryan Ltd. for $4.4 million in June 2014, and Adler, Pollock & Sheehan
P.C., Robert I. Stolzman, J. Michael Saul, and Keith W. Stokes for $12.5 million in
August 2015.

The Corporation is still engaged in litigation against First Southwest Company. That
litigation will go forward in order to further reduce the taxpayers’ potential
exposure on the remaining moral obligation.