On May 8, 2015, Airborne Media Group, Inc. filed a voluntary chapter 11 petition in the United States Bankruptcy Court for the District of Delaware. The voluntary petition was filed after several creditors commenced an involuntary chapter 11 case in Colorado on April 17, 2015. The chapter 11 case has been docketed as case no. 15-11018 and has been assigned to The Honorable Kevin Gross.
In support of the chapter 11 filing, Airborne filed the Declaration of Cordell R. Brown, CEO of the Debtor. According to the Declaration, the Debtor started in 2011 as an idea to permit patrols at a bar or restaurant to listen to the muted live sports or other events being shown in the venue through their smart phone or ipad. The Debtor created smartphone applications and other products to permit this device interactivity. As of the time of the filing, the Debtor had 9 employees, over 100 equity holders (with $6 million invested) and a $250,000 unsecured line of credit and about $1 million of unsecured debt (not counting a judgment obtained by certain of the shareholders.
The Declaration describes events leading to the filings as beginning with a dispute where certain shareholders commenced an action to value their shares. While the Debtor attempted to reach a deal with the shareholders, they were ultimately unsuccessful, and the state court in Nevada found in favor of the shareholders at a substantially higher value, and entered a nearly $2 million judgment against the Debtor. The Debtor appealled that judgment. Shortly before a scheduled mediation conference, certain petitioning creditors filed an involuntary chapter 7 case in the Delaware bankruptcy court.
According to the Declaration, the Debtor hopes to continue to operate its business as it had pre-petition, and is seeking continued investment and customers for its products. It will also seek to dismiss the pending Colorado chapter 7 case or convert it to a chapter 11 case, transfer it to Delaware, and consolidate it with the Delaware chapter 11 case.