Last week, a bankrupty judge formally confirmed a plan to bring music company SFX Entertainment, which is known for putting on popular electronic music events such as TomorrowWorld, Electric Zoo and more, out of bankruptcy. The plan was approved and proposed to wipe out roughly $400 million in debt.
SFX filed for bankruptcy back in February and has since been working with creditors to put it in a position to come out of bankruptcy as a private business with minimal debts. They have sold off some assets, but still own online streaming platform Beatport and its main festival business. The judge also rejected a request by SFX shareholders to participate in the restructuring talks which showed that former investors will not be involved in the future of SFX.
The plan also points out which former SFX executivess could be sued, with CEO Robert Sillerman being the most likely defendant. The latest plan notes that “possible causes of action against Mr. Sillerman include claims for breach of fiduciary duty, breach of contract, negligent misrepresentation and fraud. In addition, the debtors claims include claims against and arising from agreements with entities affiliated with Mr. Sillerman, including, for breach of contract, negligent misrepresentation, and fraud.”