Black News Channel files for bankruptcy, employees are not paid

Hundreds of employees are left without their last paycheck, including dozens living in the Atlanta metro area.

ATLANTA — Hundreds of employees are being left behind, unpaid for their work in a relatively new medium. Black News Channel filed for bankruptcy last month, and since then workers have said they have not been paid for weeks. While the company is based in Florida, dozens of its employees live in the Atlanta area.

Dellan Sellers worked on social media for BNC. After two rounds of layoffs in a month, as well as what sellers called poor communication about the company’s downturn, she left BNC in February this year, nine months after she started.

“I didn’t feel safe at that point anymore,” Sellers said. “I could tell there was something going on, something they weren’t communicating to us. So I felt it was time for me to protect myself and get out as much as I could before it all happened. collapses under me.

Last month, BNC announced that it would file for Chapter 11 bankruptcy and cease operations. On Thursday evening, the company said it would not be able to pay workers for the week of March 19-25 as previously promised. These payments were expected on Friday, April 8.

Attorney Gary Freed said workers can file what’s called a priority claim in federal bankruptcy court, which can take up to 30 days to process. There is also a limit to the amount the court can pay. Freed said the court can use a preferential payment or transfer and take bonuses or other payments made in the past year to company executives to cover the cost of unpaid checks to employees.

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“It presupposes that they actually have money to pay, because the bankruptcy court can’t draw blood from a turnip,” Freed said. “If they don’t have the money, the court and a trustee can look back into the company funds and where they went.”

BNC was launched in February 2020, just before the start of the pandemic. But financial difficulties would soon doom the company, particularly after major shareholder Shad Khan withdrew its funding. Khan also owns the Jacksonville Jaguars.

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“When you file for bankruptcy, there’s an automatic stay,” Freed said. “Everything stops, it’s a freeze frame. From that moment on, the court has jurisdiction over the debtor, and the debtor can’t do anything without the permission of the court. It’s a shame the system works thus, to protect a company against payment defaults.

11Alive obtained a BNC email sent to employees on Thursday evening, stating in part:

“Unfortunately, under the Chapter 11 filing, we must be authorized by the court to pay anyone, including the remainder of earned but unpaid wages to all of you. So, although it has been communicated that wages unpaid would be paid on April 8, we have been advised that this cannot happen. Our commitment to reconcile this through the required legal process is ongoing and absolute. Rest assured that this procedural matter has our full attention, and we We will stay in close contact with you as this process is completed.

We recognize the difficulties this delay may cause and thank you for your continued patience during what is understandably a difficult and challenging time for everyone.”

Sellers said the payments cannot come soon enough to provide relief to hundreds of his former colleagues, several of whom are struggling to pay their bills.

“They still have bills to pay, kids to feed, so they’re relying on that money,” Sellers said. “Everyone knows what’s going on, but debt collectors don’t care. They just want to know when that money is coming. It’s like everyone is drowning in this anxiety, this scenario. But a lot of people try to stay positive.”

Other news outlets contacted former BNC employees, alerting them to job openings. The National Association of Black Journalists also offers free membership to former BNC employees who have lost their jobs.

BNC said it was working to restructure and possibly return to being a viable business. But Freed said 80% of companies that file for bankruptcy end up failing.