Bouncing Back (Fashionably) From Bankruptcy

Posted in: General Bankruptcy

Fashoin designer Michael Kors is the embodiment of the self-made success story.  He designed and sold clothing from a very young age.  He set up a fashion boutique in his basement at the age of 11.  Working in a department store in sales, he ended up designing the store’s clothing line.  He started his own women’s clothing line in 1981.

Going through a Chapter 11 bankruptcy in 1993 did not deter the designer.  Chapter 11 provides (generally) for reorganization, usually involving a corporation or partnership. A Chapter 11 debtor proposes a plan of reorganization to keep its business alive and pay creditors over time.

The designer expanded into the realm of reality television in the early 2000s.  He served as a judge on the television show “Project Runway” for ten seasons, known for his fair but rigid comments towards the contestants.

His company went public in December 2011.  Earlier this year, his fortune topped $1 billion.  Once just sold in department stores, the Michael Kors brand is now found in stand-alone stores around the world.  From fragrances, women’s shoes, men’s shoes, eyeglasses, and handbags, the classic staples of the line appeal to many.  In fact, a quick office survey here at The McKellar Law Firm, PLLC found a pair of coral platforms and a patent handbag.  The Kors story illustrates that massive success is sometimes punctuated by the restructuring or shedding of debt.