Redbox’s owner files for bankruptcy after repeatedly missing payments and payroll

Redbox’s owner, Chicken Soup for the Soul Entertainment, filed for bankruptcy extortion overnight. This comes astatine the process extremity of a period successful which the DVD rental institution defaulted connected loans, saw an bid for its cars to beryllium repossessed, and missed payroll for employees.

Chicken Soup for the Soul Entertainment informed employees of the filing precocious Friday, penning successful an email seen by The Verge that it had filed for a debtor-in-possession indebtedness — a mode for companies that are reorganizing aft filing for bankruptcy to unafraid further moving superior to conscionable payroll. 

It’s a pressing substance for the company, arsenic employees person been waiting for paychecks since June 21st. The institution besides promised to reinstate wellness security for his employees, which had lapsed successful May.

However, it’s not definite that the institution volition beryllium capable to unafraid specified a loan. Chicken Soup’s bankruptcy filing shows that the institution owes wealth to a fig of retailers including Walmart and Walgreens, arsenic good arsenic large Hollywood studios similar Universal, Sony, Lionsgate and Warner Bros.

Other creditors see smaller studios, streaming platforms, and astute TV manufacturers, with the database of names including the BBC, Vizio, and Plex; Redbox and Chicken Soup-owned Crackle person been operating their ain free, ad-supported streaming services connected a assortment of platforms. The institution besides owes wealth to its landlords, the vendor it rents its car fleet from, and others.

Chicken Soup took connected $325 cardinal successful indebtedness erstwhile it acquired Redbox successful 2022 and has since been sued implicit a twelve times implicit unpaid bills. The institution precocious settled 1 of those lawsuits with NBCUniversal but promptly missed the archetypal agreed-upon payment, starring to a tribunal bid to pay the full $16.7 cardinal balance. Altogether, Chicken Soup has $970 cardinal successful debt, according to the bankruptcy filing.