Things just keep getting worse for the premium denim brand Rock & Republic.
While it filed for Chapter 11 earlier this month, many industry insiders are saying that the real problem the brand's founder Michael Ball. Ball refuses to give up his CEO title, even if it means bankrupting the whole company. Sources say that the firm was forced into bankruptcy after Ball refused an offer to refinance a $15 million loan from Richard Koral, backer or rival denim brand Seven for All Mankind.
"It's not like the company's operations necessarily are done for — there are many people who would like to run this business," said one investor close to the situation. But Ball — who has bragged to the media about doing jail stints during his youth — is "too erratic for the taste of a lot of people circling the company."
Ball's legal problems, ranging from multiple lawsuits dealing with blackmail, abuse and sexual harassment, has deemed him "toxic" to possible investors. Today, a judge is expected to decide whether to move the bankruptcy case to Los Angeles from New York. A move to the West Coast would give Koral the upper hand over Ball, given LA's more creditor-friendly bankruptcy courts, sources said.
And who wouldn't want to get into a business with someone like that?
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