Girls Gone Wild Files for Bankruptcy [Updated]
LOS ANGELES — Joe Francis’ Girls Gone Wild (GGW) empire filed for bankruptcy protection in California yesterday.
The Wall Street Journal reported that Francis put GGW Brands LLC and other companies related to the brand under Chapter 11 protection listing a $10.3 million debt in the 12-page bankruptcy petition.
Francis apparently took action to keep casino mogul Steve Wynn’s Las Vegas resort from grabbing his company’s assets to satisfy the multimillion-dollar lawsuits.
Last September, a Los Angeles jury awarded Wynn $20 million in punitive damages in addition to an original defamation judgment against Francis.
According to the Journal, Wynn’s attorneys recently targeted Francis’ GGW assets held in affiliates called GGW Direct LLC, GGW Brands LLC, GGW Events LLC and GGW Magazine LLC.
“Such entities were not named in the domesticated judgment,” an attorney for those companies said in court papers, noting that Wynn had also asked for a receiver to take over those companies.
“Francis has effectively evaded meaningful collection by making it appear that he has virtually no income or assets, despite his publicly lavish lifestyle,” Wynn’s attorneys said in the lawsuit. “Wynn has confirmed what it has long suspected, namely that Francis has avoided Wynn’s collection efforts by, among other things, not taking any income and using accounts held by various entities that do business under his ‘Girls Gone Wild’ brand to pay all his personal expenses.”
By filing for bankruptcy, Wynn’s collection efforts have been temporarily stymied. Judge Sandra R. Klein of the U.S. Bankruptcy Court in Los Angeles has been named as the dispute’s new referee.
Wynn’s lawyers also claim that Francis has not shown up for lawsuit-related appointments.
“Francis claims to know nothing about his finances, despite living a luxurious lifestyle that includes living in a multi-million dollar home in Bel Air, regular use of a multi-million dollar estate in Mexico, while regularly being seen at expensive restaurants and clubs,” Wynn’s attorneys said in court papers.
The GGW founder's legal woes also included an accusation last October that he fraudulently transferred companies he controls in a scheme to evade paying off a woman who won a $5.77 million judgment after she sued over the non-consensual use of her image in one of his videos.
Girls Gone Wild issued an official statement on the matter on Thursday afternoon:
"Yesterday several of the U.S. operating entities for Girls Gone Wild joined the ranks of companies like American Airlines and General Motors having sought reorganization under Chapter 11 of the United States Bankruptcy code. Girls Gone Wild remains strong as a company and strong financially. The only reason Girls Gone Wild has elected to file for this reorganization is to re-structure its frivolous and burdensome legal affairs. This Chapter 11 filing will not affect any of Girls Gone Wild's domestic or international operations. Just like American Airlines and General Motors, it will be business as usual for Girls Gone Wild."