The VFX company Gravity Post filed a petition for bankruptcy protection in the Bankruptcy Court of the Southern District of New York. The Chapter 11 filing claims the business is sound and has, over the last several months, secured potentially profitable contracts from large clients. There are no plans to lay off any employees, and the company expects to continue with business as usual.
It appears that the primary reason for the bankruptcy filing is to protect the company from being evicted from its Madison Avenue offices. The landlord claims to be owed $464,381 and legal fees. Gravity Post claims not to have the money at the moment but that it could pay it off over time. The company has worked on movies such as “Crazy Stupid Love” and the television shows “Sex and the City” and “The Sopranos.”
Documents filed with the bankruptcy court show Gravity Post has between $100,000 and $50,000 in assets that have a liquidation value of $258,000. Liabilities are listed as $1 million to $10 million. Schedules and statements are due on or before Oct. 1. By Jan. 1, 2014, Gravity Post must have a Chapter 11 plan ready for the court’s review.
Chapter 11 bankruptcy may be a way for a business to gain time to regroup its finances. If a business owner believes some extra time might solve the company’s issues, it may be wise to consult a bankruptcy attorney. An attorney can review the company’s financial situation and may be able to make recommendations on how best to proceed with the part of the Bankruptcy Code that fits the situation.
Source: Deadline.com, “VFX Firm Gravity Post Files For Chapter 11 But Not Shutting Down“, Dominic Patten, September 18, 2013by