The state of Rhode Island could soon find itself in the videogame business.

Kingdoms of Amalur developer 38 Studios is in trouble. How much trouble isn't clear yet, although government types are starting to sweat a bit over the fact that the state could be on the hook for over $100 million if things fall apart completely. That's a lot of coin, especially for a deal with a single business that's less than two years old, but on the upside, it could mean that Rhode Island might end up owning the Kingdoms of Amalur IP as well as that of the unannounced "Project Copernicus" MMO.

Attorney and Law of the Game editor Mark Methenitis told Joystiq that based on the information he's seen, the state's loan to 38 Studios was secured by the company's assets, including all its intellectual property. "That would include all the rights to Kingdoms of Amalur and any other games they may have in development, even if no information about those titles has ever reached the light of day," he said.

"If they default on their obligations to the RIEDC [Rhode Island Economic Development Corporation ], then the RIEDC can turn around and take possession of as much of that as is necessary to pay off the debts owed," he continued. "The RIEDC could then sell the rights in all of the Kingdoms of Amalur to another developer to offset the millions owed by 38 Studios, and this sale would typically be an auction-style sale to the highest bidder."

Methenitis added that if the sale of 38 Studios' IP brings in more than the money owed to the state, "the RIEDC will theoretically owe those funds back to 38 Studios," even though we all know there's no way that'll ever happen. It would be cool to see Activision drop some big bucks to snag Kingdoms of Amalur just to mess with EA, though.

No, that's not much of an upside.