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On the heels of an array of fashion and retail bankruptcy filings that began to unfold over the course of the year in 2016, New York-based designer Bibhu Mohapatra and retailers The Limited, Wet Seal, and Payless all made headlines when they filed for Chapter 11 protection in early 2017. They were swiftly followed by a handful of additional filings by other retailers, signaling that there is no end in sight to the constant string of fashion and other retail companies struggling financially and looking to bankruptcies courts for protection from their creditors.

For the uninitiated, Chapter 11 bankruptcy – one of the most commonly utilized forms of bankruptcy – allows a company to continue operating while it executes a reorganization plan. Chapter 11 can take a number of forms, but in short: A chapter 11 case begins with the filing of a petition with the bankruptcy court by the debtor (the entity that owes the debt – aka the retailers in the cases at hand). This is followed by the debtor proposing and executing a reorganization plan, which may be used to compromise or even eliminate certain classes of debt.

All the while, the debtor usually remains in possession of his assets and continues to operate any business, subject to the oversight of the court and the creditors committee. Typically, a company that has filed for Chapter 11 bankruptcy trying to stay in business, and as indicated below, this complex proceeding can be very effective in solving short term business problems in an otherwise viable company or winding down a company with valuable assets. (Also included below are instances in which brands have entered into administration, an insolvency process in the United Kingdom by which a company is “placed under the control of an insolvency practitioner to enable the insolvency practitioner to achieve objectives laid down by statute.”)

Fashion and Retail-Related Bankruptcies

Here is a look at some of the most recent fashion and retail-related bankruptcy filings …

Sept. 2023 – Soft Surroundings

Soft Surroundings filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court for the Southern District of Texas in Houston on September 10, citing up to $50,000 in estimated assets and between $50 million and $100 million in estimated liabilities. The St. Louis-based retailer’s parent company Soft Surroundings Holdings LLC says it will close the womenswear company’s 44 leased stores and sell its online and catalog business to Coldwater Creek as part of the Chapter 11 plan. “Over the past year, we have taken significant steps to fortify our financial standing including rightsizing our business to better match current market conditions,” Bridgit Lombard, Soft Surroundings executive chair, said in a statement. “This will allow us to adapt, restructure and emerge more resilient, ensuring the longevity of the beloved Soft Surroundings brand for our customers and partners.”

Jul. 2023 – Julien Macdonald

The eponymous label of Welsh designer Julien Macdonald initiated liquidation proceedings on July 24, citing economic instability. “The business fell into trouble during the Covid pandemic which affected all aspects of the retail sector. Julien Macdonald lost a significant proportion of revenue following the collapse of Debenhams at the end of 2020,” with cashflow issues being “compounded by general inflationary costs, which impacted on all aspects of the business,” FTS Recovery said in a statement. FTS – which has been appointed as the liquidator for the Julien Macdonald company – further stated that “no employees or existing contracts could be saved.” FTS will sell the 25-year-old, London-based company’s remaining inventory and other assets in order to seek repayment for creditors.

Jun. 2023 – Christopher Kane

Christopher Kane has entered into administration and is looking for a buyer, the London-based fashion brand confirmed on June 21. The company – which was launched by its eponymous founder in 2006 – “said the board of Christopher Kane Ltd. has recently resolved to file a notice of intention to appoint FTS Recovery as administrators to hammer out a rescue plan for the company,” WWD reported, noting that the company revealed that “key stakeholders have been notified, [and] a period of accelerated marketing activity will now follow, with a view to locating potential interested parties to either refinance the company’s existing debt, or alternatively locate a purchaser for the business and assets.” French conglomerate Kering acquired a 51 percent stake in Christoper Kane for an undisclosed sum in 2013, and ultimately, sold it back to the brand in 2018. 

Apr. 2023 – David’s Bridal

David’s Bridal, LLC announced on April 17 that the company and certain of its subsidiaries filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of New Jersey. The company expects to file a recognition proceeding in Canada and a subsidiary of David’s Bridal expects to commence an administration proceeding for its business in the United Kingdom.

March 2023 – Scotch & Soda

Scotch & Soda has filed for bankruptcy in Netherlands due to “serious cashflow problems” that started as a result of the COVID-19 pandemic and have continued amid high inflation and a consumer spending squeeze, per Reuters. “Despite record sales, a structural cash flow deficit has led to the company’s failure to absorb the negative effects of [COVID-19] and high inflation,” the Amsterdam-headquartered fashion brand said in a statement, noting that its 32 stores in the Netherlands will remain open “for the foreseeable future.” The Sun Capital-owned company earned record revenues of 342.5 million euros in financial results reported for the 2022 fiscal year,”according to Yahoo Finance, but said that the previous two years of pandemic restrictions “affected its business performance and financial health negatively,” promoting its Netherlands-specific bankruptcy filing.

February 2023 – Tuesday Morning

Off-price retailer Tuesday Morning Corp. filed for bankruptcy protection on Feb. 14, the second time since the onset of the pandemic. Dallas-based Tuesday Morning Corp. filed its Chapter 11 petition in the Northern District of Texas, listing assets and liabilities of $100 million to $500 million, in its bankruptcy petition, per Bloomberg, which reported that the retailer “emerged from its last bankruptcy in January 2021 after closing about 200 stores, cutting its employee headcount and slashing debt.”

In a press release announcing its second bankruptcy, Tuesday Morning revealed that it has obtained $51.5 million of debtor-in-possession financing from Invictus Global Management to support its ongoing operations, subject to the approval of the bankruptcy court.

January 2023 – Forma Brands LLC

Morphe beauty’s owner Forma Brands LLC filed for bankruptcy in Delaware after reaching a deal with lenders, including Jefferies and Cerberus Capital Management. In a statement on January 12, Forma revealed that it has entered into “a definitive asset purchase agreement” with lenders Jefferies Finance LLC (together with Jefferies Finance LLC, funds managed by Cerberus Capital Management, L.P. and FB Intermediate Holdings, LLC) under which “substantially all of FORMA Brands’ assets will be acquired.” Forma also announced that it has “received a commitment for approximately $33 million in debtor-in-possession financing from the Investor Group, which, subject to court approval, will be available to support the business and its operations throughout the court-supervised sale process.” The investor group will gain control of FORMA Brands’ “wholesale operations, online platforms, and international Morphe retail stores.”

“This agreement is a testament to the strength of our brands most meaningful to our consumers,” Forma president Simon Cowell said in the statement. “We will have additional financial resources available to invest in our multi-category portfolio, product launches and innovative brand and marketing strategy as we advance our vision to inspire creativity, promote inclusivity and connect with consumers around the world through beauty.”

Forma’s Chapter 11 filing comes after the company – whose Morphe brand previously surged in popularity thanks to partnerships with some of YouTube’s biggest beauty influencers, banking a reported $400 million dollars in revenue in 2019 – announced on January 6 that it would shutter all its U.S. stores.

UPDATED (Mar. 30, 2023): A Delaware bankruptcy court approved a deal that will see secured lenders Jefferies Finance LLC (together with Jefferies Finance LLC, funds managed by Cerberus Capital Management, L.P. and FB Intermediate Holdings, LLC acquire “substantially all” assets of Forma, including wholesale operations and online platforms, for $690 million


This is a short excerpt from a data set that is published exclusively for TFL Enterprise subscribers. For access to our up-to-date fashion & retail bankruptcies tracker, inquire today about how to sign up for an Enterprise subscription.