Penthouse Files for Chapter 11 Bankruptcy

LOS ANGELES—Penthouse Global Media has filed for Chapter 11 bankruptcy protection. In the filing Thursday in the US Bankruptcy Court Central District of California, Penthouse lists estimated liabilities between $10-50 million and assets of under $50,000. Among Penthouse’s top creditors are a pair of law firms, Greenberg Traurig, LLP and Bayard, P.A., who are owed more than $198K and $121K, respectively. Two accounting firms—TGG Accounting and Squar Milner LLC—and the law firm Hogan Lovells US, LLP are also listed among the company’s five biggest creditors, with each due more than $50K. A case filed under chapter 11 of the US Bankruptcy Code is typically referred to as a "reorganization" bankruptcy because it allows the debtor to propose a plan for profitability post-bankruptcy.  CEO Kelly Holland acquired the Penthouse brand in February 2016 from FriendFinder Networks—she was managing director and president for Penthouse's broadcast operations before the acquisition. She was not available for comment at post time. Originally founded by the late Bob Guccione in 1965, Penthouse began publishing its monthly magazine in North America in 1969 in an attempt to compete with Playboy. This week’s filing marks the third time in Penthouse’s history it entered into Chapter 11. In August 2003, General Media, then parent company of the magazine, filed for bankruptcy protection. Three months later it was announced that Penthouse magazine was being put up for sale as part of a deal with its creditors. A year later in November 2004, Guccione resigned as Chairman and CEO of Penthouse International, the parent of General Media. Penthouse also filed for bankruptcy protection in September 2013, when the magazine's owner FriendFinder’s common stock was no longer traded on the open market. In August 2013, FriendFinder’s stock was delisted from Nasdaq because it consistently failed to trade for more than $1.