Premium jeans retailer True Religion Apparel filed papers in Delaware bankruptcy court Monday, less than three years after its last appearance, saying that coronavirus-related retail closures on top of preexisting liquidity issues had tipped it back into Chapter 11.
In court papers filed Monday, the Los Angeles-based company said the pandemic-related closure of all its retail locations and all the stores of its wholesale buyers had accelerated “existing liquidity constraints” and left it no choice but to furlough all nonessential employees and reenter Chapter 11.
“While the debtors would have preferred to wait out the current instabilities of the financial markets and retail industry generally, they simply could not afford to do so,” it said.
True Religion said in its bankruptcy filings it has just over 1,000 employees, 92 percent of them currently furloughed. The company’s Chapter 11 petition listed between $100 and $500 million in liabilities.
The company, founded in 2002, previously entered bankruptcy in July 2017, saying its revenues peaked in 2013 and that layoffs and store closings had failed to stem losses caused by customers’ migration to online shopping.
After its first bankruptcy filing in 2017, the brand emerged four months later with plans to reinvigorate the brand by adopting a nostalgic, throwback vibe. In November, True Religion hired its former president Michael Buckley as its top executive.