A couple of weeks ago, Federated Sports and Gaming announced that they were filing Chapter 11 bankruptcy. This move was not surprising seeing that the company was virtually bleeding money from their running of the Epic Poker League. The company then released statements that the move was primarily one of reorganization. However, according to recent reports that reorganization plans may not come to fruition.
FS+G owes $5 Million but has about $15,000 in cash.
According to filings, FS+G owes more than $5 Million to over 100 different creditors. In addition, the company had only $15,000 in cash at the time of the filing. Some of the creditors owed are as follows:
- Pinnacle Entertainment – $2 Million
- All-In Production – Over $2 Million
- 411 Productions – $541,373
- Lawfirm of Kirkland & Ellis – $250,000
- Rogers and Cowan – $71,391
- Savage Tournaments – $33,333
Other creditors include several FS+G employees, independent contractors, and even the Disabled American Veterans.
In addition, it appears that FS+G failed to make any payments on their acquisition of the Heartland Poker Tour, a tour that the company acquired on June 20th, 2011. The first payment of $1 Million was due to All-In Productions by September 30th, 2011, but the payment was never made.
There have been conflicting reports as to how the bankruptcy proceedings are commencing. Some reports claim that FS+G’s reorganization plans have been rejected by bankruptcy courts while FS+G claim that the company’s plans have not been rejected. In addition, FS+G claims that most executives are currently working for free with other employees only receiving a small stipend for their services.
The Epic Poker League is the main reason behind the company’s downfall. It added $400,000 to each of the three tournaments it has held thus far and had to pay for TV time for their EPL Main Events.
The last events, including the $1 Million freeroll are currently on hold while the company tries to reorganize. However, according to sources and from reports from EPL contractors, most of those working for the EPL are currently without a job and are awaiting the bankruptcy court’s decision as to whether or not they will be paid.
Right now, things don’t look so great for the once promising pro poker league. Should the company somehow emerge from bankruptcy, the one thing that will be certain is that the league will have to change dramatically to be able to survive in the current tough economic climate.