An Award-Winning Brewery Faces 2 Former Employee Lawsuits. Its CEO Says Chapter 11 Was the Cheaper Option

The craft microbrewery lists roughly $301,000 in assets against nearly $547,000 in liabilities.

A craft microbrewery in Sacramento has just filed for Chapter 11 bankruptcy amid two wrongful termination lawsuits.

Fort Rock Brewing, known for its award-winning pilsner, is seeking Chapter 11 bankruptcy protection to keep operations active during the lawsuits, the Sacramento Business Journal reported.

According to court filings with the U.S. Bankruptcy Court Central District of California, the brewery listed its estimated assets at $301,178.87 and estimated liabilities at $546,748.

The brewer will remain open, despite the filing,

The brewer will remain open, despite the filing, at its Rancho Cordova location. Tom Fuquay, Fort Rock Brewing’s co-founder, majority shareholder, and CEO, told Inc. that operations will not change.

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Cecile Ganel, the brewery’s operations manager, told the Sacramento Business Journal that the decision was hard to make, but the ownership group ultimately found it best for the business. According to a 2016 article from the same publication, Fort Rock Brewing is independently owned by Fuquay along with Heidi Wilder, John Dudek, and Kimberly Dudek. Ganel said that filing is intended to protect the brewery and its operations during the two lawsuits.

Fuquay told Inc. that the bankruptcy filing was necessary in face of the two lawsuits.

The court filing lists a $150,000 SBA disaster loan, equipment-financing obligations, substantial trade debt, and more than $200,000 in insider loans. Fuquay said that Fort Rock Brewing has been impacted by the downturn faced by the alcohol industry in recent years and the company “just didn’t have the funds to put forth to defend against those suits.”

Source: www.inc.com