The idea of Interview magazine relaunching quickly and under the ownership of some former high-level executives at the title has many scratching their heads. Such is the nuanced world of bankruptcy.
“I don’t understand how this isn’t illegal,” is how one source put it, after noting that Interview owes money to a string of high-profile photographers, along with many lower-level editorial employees and freelancers that found themselves not only unpaid, but out of a job when the title last week filed for Chapter 7 bankruptcy, a liquidation.
But the title, founded by Pop Art arbiter Andy Warhol in 1969, seems already headed for a relaunch under a new holding company, Crystal Ball Media, according to an internal memo published by The Daily Front Row. The rub is that CBM was formed by Interview’s president Kelly Brant, the daughter of Interview’s wealthy current owner Peter Brant, and Jason Nikic, who was Interview’s chief revenue officer but signed the memo as publisher. Should Interview relaunch in September, as the memo suggests, Nick Haramis will stay on as editor in chief, while Mel Ottenberg, a stylist well known for working with Rihanna, seems to have already joined as creative director, a position previously held by stylist Karl Templer.
As president and chief revenue officer, Brant and Nikic had a hand in not paying many people who worked under them before Interview filed bankruptcy, including Templer, who is said to be owed $280,000 and left in April over lack of payment. Former editorial director Fabien Baron claims to be owed nearly $700,000 and also left this spring over lack of payment and called out Brant specifically as having control over payment in his subsequent lawsuit. Former associate publisher Jane Katz last year sued the magazine for unpaid wages of more than $230,000, along with claims that she was unjustly fired, and Dan Ragone, who was Interview’s president for six years and in April became president and chief revenue officer of Daily Front Row, sued in 2016 for allegedly unpaid wages of about $170,000. A source said Interview also owes money to photographers Craig McDean and Steven Klein.
Representatives of Interview and CBM could not be reached for comment, nor could Ottenberg. Baron and Templer were not immediately available for comment.
While there are about 300 individuals and companies with outstanding payments owed who are now creditors of Interview, leaving it easily millions of dollars in the hole, with a Chapter 7 bankruptcy, the possibility of any being paid is slim. If anyone is paid, it will first be Interview’s still unnamed secured lender, likely Peter Brant, whom a company spokeswoman told WWD last week has been floating the title as it’s been operating at a loss for some time.
And the apparently strategic move to put Interview straight to liquidation and then within days announce a prospective relaunch is undeniably cynical — as is Nikic’s suggestion in his memo that publicity of the bankruptcy has led to a gain of 15,000 Instagram followers and reach to “a whole new audience of young people” — but there seems to be nothing illegal about it.
“There’s nothing inherently wrong,” Debra Dandeneau, global co-chair of restructuring and insolvency at law firm Baker & McKenzie, said of a company’s principles moving to buy up a liquidating company’s assets.
Dandeneau, however, explained that Chapter 7 was “an unusual step” because the bankruptcy process is immediately handed over to a court-appointed trustee, who gets paid based on a percentage of whatever value is squeezed out of the assets, which in this case are probably few. For Interview, there’s the brand name and probably a subscription list, but little else that could be sold.
“It’s just very, or somewhat unusual to file a Chapter 7 because that’s like saying we just want to walk away and you have a company that really doesn’t have any assets, but it’s an interesting strategy,” Dandeneau added. “From their perspective…it’s better to just throw it up for sale, then it’s cheaper to bid for the primary assets.”
And given Brant’s familial relationship to Interview’s current owner, Dandeneau said it’s “quite possible” that some kind of easy deal for the assets could be struck.
In the memo, Nikic said CBM was “in the process” of acquiring Interview’s intellectual property, without saying what exactly that entails or from whom. One source speculated that Peter Brant may hold Interview’s trademark personally or in a another holding company not involved in the bankruptcy. There are about two dozen current and expired trademarks for Interview, a handful of which originate with the entity DCP-BMP Media Lender LLC. It’s unclear who owns that entity, although BMP Media Holdings is another Brant-owned entity that’s filed Chapter 7 bankruptcy, so it seems safe to speculate that it shares an owner. If DCP-BMP turns out to control the main Interview trademarks, CBM could have a pretty easy time of getting what it needs to relaunch under the same moniker.
A trustee incentivized to find money could turn up as a bump in the road for Kelly Brant’s new holding company, should another bidder emerge with a better offer. Another bump could be the right that the creditors have, which is to, as a group, push for a new trustee, if they feel the current appointee isn’t savvy enough about their industry. The likelihood of this is again slim, however, as Dandeneau noted this tends to only become an issue when creditors are experienced financial types.
But should Interview relaunch after essentially skipping out on fees to hundreds of players in the fashion and publishing industry, is it possible that it will have the same allure for prospective contributors? Will anyone be willing to risk working for people who have shown at best an indifference to timely and full payment to their partners and employees? As Warhol himself said, “Art is what you can get away with.”
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