"American Idol's" parent company filed for Chapter 11 bankruptcy protection in New York on Thursday just weeks after the show concluded its 14-year run.
According to The Hollywood Reporter, the Los Angeles-based Core Media Group — which is also responsible for "So You Think You Can Dance" — estimates its liabilities at around $512 million, while its assets are worth $73 million.
Chief among the company's unsecured creditors is "Idol" creator Simon Fuller, who modeled the singing competition after his "Pop Idol" show in Britain. The company owes him $3.37 million. He made a payment demand on April 11, an action that contributed to the bankruptcy decision.
In its court filing, Core explained how it thinks it came to its money problems.
"The decline in overall economics and the announced cancellation of the 2017 season of ‘American Idol’ on Fox negatively impacted the revenues and profits of the debtor’s business," court papers said,
according to The New York Times.
"Additional negative ripple effects included, among other things: a decline in re-broadcast fees due to reduced broadcast hours; the loss of both Coca-Cola and AT&T as main sponsors of American Idol; and the closure of the American Idol Experience theme park attraction at Walt Disney World."
The company's earnings fell in 2014 by $14 million, year over year, and declined by $35.6 million in the first six months of 2015, compared to the same time period the previous year.
The Wall Street Journal reported that a spokeswoman for Core Entertainment said there are no plans to sell any company assets in bankruptcy.
Core "was originally set up to manage the intellectual property of Elvis Presley and Muhammad Ali," according to The Hollywood Reporter, but, "The purchase of Fuller's 19 Entertainment in 2005 is the company's crown jewel and it continues to own the recording rights of such stars as Kelly Clarkson and Carrie Underwood, who have appeared on Idol."
Core also owns Sharp Entertainment, producer of the unscripted shows "Man v. Food," "Extreme Couponing," and "My Crazy Obsession."
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