Category Archives: entertainment industry
By: Daniel Hart and Salene Mazur Kraemer
On September 11, 2015, the Please Touch Museum in Philadelphia filed for Chapter 11 bankruptcy (Bankruptcy Case no. 15-16558) in the United States Bankruptcy Court for Western District of Pennsylvania, thus triggering an automatic stay or injunction pursuant to 11 U.S.C. 362 of the Bankruptcy Code that halts actions by creditors, with certain exceptions, to collect debts from the debtor who has declared bankruptcy. “Don’t Touch the Debtor”.
The museum intends to remain as a debtor-in-possession and continue operating during the pendency of the Chapter 11 Case. The museum’s mission is to enrich the lives of children by creating learning opportunities through play. It aims to achieve this mission by creating meaningful interactive play-based experiences within the museum and beyond its walls for all young children and their families. The museum has been nationally recognized for its lasting impact.
The museum filed for protection under Chapter 11 bankruptcy because it borrowed more money then it could pay back to renovate a new home in Fairmount Park’s Memorial Hall. Sources say the bankruptcy filing has two main objectives: (i) to shed the majority of the $60 million it owes holders of its debt, and (ii) to negotiate a deal whereby the museum turns over maintenance and repairs of Memorial Hall to the city, which owns it.
The museum owes about half of its debts to a group of bondholders. It formulated a plan to pay back these bondholders about $11.5 million of the $60 million debt. Filing for bankruptcy was a tactic used to get this bondholder group to agree to the plan. Also, the museum is launching a $10 million fund-raising rescue plan. In addition to paying off the debt, the museum intends to use the money to pay professional fees associated with the bankruptcy and to make some exhibit upgrades. It remains to be seen whether this strategy will solve the museum’s problems.
by Justin A. Saporito, Law Clerk
Aramid Entertainment Fund, Limited filed for Chapter 11 protection in the Bankruptcy Court for the Southern District of New York on June 13, 2014. Debtor has declared assets of $237.3 million and consolidated debt of $11.5 million. Debtor was assigned case number 1:14-bk-11802, a judge has yet to be assigned. Approximately 96 creditors were listed in the petition; among them are several other Aramid entities including Aramid Liquidating Trust, Ltd. and Aramid Entertainment, Inc. which jointly filed with the Debtor and were assigned consecutive case numbers.
Aramid Entertainment Fund, Limited is part of Aramid Capital Partners, LLP, a London based hedge fund that specializes in financing movies. According to their website, Aramid Capital has provided financing for thirty-two (32) movies including Paranormal Activity, W., and How to Lose Friends & Alienate People. Please click here for a list of their productions.
Debtor filed for Chapter 11 protection due to the cost of ongoing litigation against several of its borrowers who failed to repay loans or violated film-financing agreements. One such suit began in February 2012 and is over an alleged $44 million in losses. Debtor invested $22 million in a financing deal between Relativity Media, LLC and Sony Pictures. Debtor alleges that executives from Fortress Investment Group, LLC used Aramid’s confidential information, which was allegedly obtained during a 2010 portfolio review as part of a proposed purchase of Debtor’s assets, to make a deal with Sony that destroyed Debtor’s investments.
The Riverhounds Event Center, L.P. and Riverhounds Acquisition Group, L.P., the limited partnerships that own and operate Highmark Stadium and the Pittsburgh Riverhounds Professional Soccer Club respectively, jointly declared voluntary Chapter 11 bankruptcy on March 26, 2014. Debtors filed in the United States Bankruptcy Court for the Western District of Pennsylvania, assigned case numbers 2:14-bk-21180 and 2:14-bk-21181 respectively. Both cases have been assigned to the Honorable Jeffery A. Deller.
The Riverhounds Event Center, L.P. owns and operates the newly constructed Highmark Stadium located in the South Side area of Pittsburgh and claims assets ranging from $1 million to $10 million with liabilities between $10 million and $50 million. Of those liabilities, $7.2 million is mortgage debt and $1.5 million in bank loans.
The Riverhounds Acquisition Group, L.P. is the limited partnership that owns the Pittsburgh Riverhounds minor league soccer team and claims assets ranging from $500,000 to $1 million with liabilities between $1 million and $10 million. The Pittsburgh Riverhounds was founded in 1999 and currently plays in the United Soccer Leagues. Much of the debt leading up to the bankruptcy was incurred in 2012-2013 during the construction of Highmark Stadium. The bankruptcy is not expected to affect the 2014 season.
Debtors share some creditors such as Shallenberger Construction, Inc., First National Bank of Pennsylvania, and Urban Redevelopment Association of Pittsburgh. Both debtors are represented by John M. Steiner of Leech Tishman Fuscaldo & Lampl, LLC.
Affairs Afloat, Inc. voluntarily filed for Chapter 11 bankruptcy relief on October 15th, 2013. The petition was filed in the Bankruptcy Court for the Southern District of New York. The case has been assigned to the Honorable Judge Burton R. Lifland, under case number 1:13-bk-13356. (Click case number for docket summary.)
The debtor is a river cruise operator that operates in New York City out of Pier 78 on West 38th Street. Affairs Afloat, Inc. was established in 1988 and provides services through its two river cruise ships, The Queen of Hearts (pictured right) and The Star of Palm Beach. The Queen of Hearts is a three level ship that is Coast Guard certified for 450 guests plus staff and crew. The Star of Palm Beach is a two level ship and is Coast Guard certified for 380 guests plus staff and crew.
Affairs Afloat hosts various cruises on specified dates in addition to its weekly cruises such as its Shadow Nightclub on Tuesday nights, Cruise Brasil on Wednesday nights, Candela Cruise on Thursday nights. Debtor also holds a Kiddie Cruise on Sunday afternoons. Debtor offers group packages for many of its events and its services are also available for private events. For more information about debtor’s programs and services please visit their website here.
Debtor claimed assets and liabilities of between $1 and $10 million with HSBC Bank, the Internal Revenue Service, the Security Exchange Commission. It appears that the Chapter 11 filing has not affected debtor’s operations as it is accepting reservations for cruises for Halloween and New Year’s Eve. Affairs Afloat, Inc. is represented by Jonathan S. Pasternak of DelBello Donnellan Weingarten Wise & Wiederkehr, LLP.
“Dance Moms” Instructor Abby Lee Miller Files for Chapter 11 Protection: Public Disclosure of Private Facts
Salene’s Preface: I was in Bankruptcy Court last week in Pittsburgh and noticed Abby walking into Court. (She is a stunning woman by the way and you can understand why she is on TV). I had to ask myself, “How do I know her?” I did figure it out pretty quickly. I was surprised to see her on my turf (that is in the world of commercial bankruptcy) and was not aware that Abby had filed for Ch. 11. My daughter is a dancer and I watch the show!
Abigale Lee Miller filed for Chapter 11 relief on January 3rd, 2011. The petition was filed in the United States Bankruptcy Court for the Western District of Pennsylvania under petition number: 10-28606 TPA and has been overseen by the Honorable Judge Thomas P. Agresti.
Debtor is better known as Abby Lee Miller, the host and instructor for the popular Lifetime reality television show Dance Moms. The show follows a group mothers and their young daughters who are participating in the world of young competitive dance. The show takes place in Pittsburgh, PA at the debtor’s studio, the Abby Lee Dance Company, and follows the ladies as they travel across the country to various competitions. Dance Moms is currently holding open casting calls for its 4th season.
The Abby Lee Dance Company was formed 27 years ago as a not-for-profit organization and is an audition only program. It is located at 7123 Saltsburg Road, Pittsburgh, PA, 15235. Debtor is also the owner of Reign Dance Productions, which shares the building with The Abby Lee Dance Company.
Debtor has declared approximately $325,500 in assets with approximately $356,500 in liabilities. Thirty-four creditors are listed in the petition, with Chase Mortgage holding the largest unsecured claim in the amount of $50,000. This debt is the unsecured portion of what appears to be a $200,000 undersecured mortgage on a home of Ms. Miller’s in Florida valued at $150k. Ms. Miller’s dance studio has a $96,000 mortgage on it; the studio is valued at around $150,000 Ms. Miller owes about $27,000 in back taxes (which are unsecured priority claims). Her unsecured debt only totals $32,000, many of whom are vendors for her business.
The Second Amended Disclosure Statement was approved on January 18th, 2013 and the Order Approving Disclosure Statement and Scheduling Hearing on Plan Confirmation was entered into on October 21st, 2013. Please click here to for a copy of the order. The debtor is represented by Donald R. Calaiaro of Calaiaro & Corbett, P.C. The Confirmation Hearing to approve her Plan of Reorganization is set for December 12, 2013 at 1:30 p.m. EST. Please click here for a copy of the Disclosure Statement. A summary of the Chapter 11 plan can be found here.
Salene’s comment: We purposefully do not often write blog posts about individual Chapter 11 cases (usually filed by very wealth individuals. Most folks file a Chapter 7 or Chapter 13). When a company or person files for bankruptcy, I warn my clients that you are subjecting yourselves to a “financial autopsy”; you are making a public filing of all of your assets and liabilities. So, information seekers can look up what your home is worth, what kind of car you drive, how much credit card debt you have, whether you own a fur coat, how much your wedding ring costs, and whether you have any money in an IRA/401k. Anyone can see how much money you have made in the last three years and they get to read what your monthly budget is for expenses. While there are certainly benefits to the privilege of filing for bankruptcy, public disclosure of private facts is certainly one of the drawbacks.
New York City Opera, Inc. filed a petition for Chapter 11 bankruptcy protection on October 3rd, 2013. The petition was filed in the United States Bankruptcy Court for the Southern District of New York. The case was assigned to the Honorable Judge Stuart M. Bernstein under case # 1:13-bk-13240. Among the motions filed with the petition was a motion to authorize debtor to refund pre-paid tickets. Please click here for a docket summary.
New York City Opera, Inc. was dubbed “The People’s Opera” by former NYC Mayor Fiorello LaGuardia. It has hosted and performed traditional and contemporary operas since its founding in 1943. Debtor filed for Chapter 11 protection due to a projected $44.1 million deficit for 2012 and a combination of a troubled economy, decreased donations, and increasing pension obligations. The debtor raised approximately $1.5 million from an online fund-raising campaign (Kickstarter), but required $7 million by the end of September in order to fund itself through the end of the year. The board and management have begun necessary financial and operational steps to wind down the company with no plans to borrow in order to fund the 2014 season.
Debtor claims assets and liabilities of between $1 and $10 million and 93 creditors including New York City Ballet, Inc. and the New York City Dept. of Finance. Please refer to the docket summary for a complete list of creditors. The debtor is represented by Kenneth A. Rosen and Nicole Stefanelli of Lowenstein Sandler LLP.
Salene had the privilege of hanging out with Nicole over the weekend in NYC. Nicole and Salene had met at the American Bankruptcy Institute this past Spring. They were also friends via Twitter. Nicole said that this Chapter 11 filing has been published in newspapers all over the world. She also said that her firm was doing the representation PRO BONO. She will be handling first day motions on Thursday!
This will definitely be an interesting case to watch.