The uncertainty of the COVID-19 era continues to wreak havoc on companies of all sizes.
New York-based Rubie’s Costume Company Inc. and certain of its affiliated companies have filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in the Eastern District of New York in Central Islip. The family-owned company hopes to facilitate financial restructuring under Chapter 11. Rubie’s is the world’s largest designer, manufacturer, and distributor of costume and related party accessories servicing more than 2,000 retail accounts.
The company maintains licensing partnerships with major studios including Disney, Marvel, Lucasfilm, Warner Bros., and Nickelodeon for a wide range of products inspired by Star Wars, Harry Potter, JoJo Siwa, DC Comics, Stranger Things, Ghostbusters, WWE, and many more.
“Given the highly seasonal nature of our business, our manufacturing relationships in China, the chilling impact of the COVID-19 pandemic on the U.S. and the global economy and potential liquidity pressures, the Board of Directors determined that the Chapter 11 filing is our best path forward as we carry out our restructuring efforts,” says Rubie’s President Marc P. Beige. “We believe that this decision will best serve our customers, licensors, employees, and business partners.”
As we recently reported, Rubie’s had cut 75% of its workforce as its California and New York-based facilities were deemed non-essential as of March 26. The company shifted its manufacturing facilities to assist in the production of hand sanitizer and personal protective equipment (PPE) to aid in the fight against COVID-19.
The company says that it “plans to use cash collateral and is engaged in the process to place a new financing facility, along with the continued support of the Beige family, that will provide for the continuation of its operations, including payments to vendors, employees, customers, and creditors.”
The companies have filed customary first-day motions with the Bankruptcy Court to support operations during the court-supervised process, including motions requesting authority to pay prepetition employee wages and benefits and to continue customer and licensor programs.
Rubie’s affiliated companies include Imagine by Rubie’s, Morbid Enterprises, Princess Paradise, and Forum Novelties.
Prior to the COVID-19 pandemic, Rubie’s was looking forward to a big year filled with new licenses and product offerings including Universal Monsters, Baby Shark, The Munsters, and more. Some items in the upcoming lineup were adversely affected by release date shifts caused by theater closures and production stoppage. The company holds licenses for Ghostbusters: Afterlife, Top Gun: Maverick, Minions: The Rise of Gru, Marvel’s Falcon and the Winter Soldier, Marvel’s Eternals, Marvel’s Black Widow, and more — all of which have seen release dates pushed back as much as a year.
Meyer, Suozzi, English & Klein, P.C. and Togut, Segal & Segal LLP are serving as Rubie’s legal counsel, BDO is serving as its restructuring advisor, and SSG Capital Advisors LLC is serving as its investment banker. The New York filing can be found under case No. 20-71970.
