Chicken Soup for the Soul Entertainment, owner of Redbox, files for bankruptcy

Chicken Soup for the Soul Entertainment, the company behind Redbox, filed for bankruptcy on Friday after it struggled to pay its employees and defaulted on loans.

The Connecticut-based entertainment company, perhaps best known for its Chicken Soup for the Soul book series, filed for a debtor-in-possession loan with hopes to reorganize after getting additional funding, according to The Verge.

But it’s unclear if there is a way out for the company, which owes Walmart, Walgreens University, Sony, Lionsgate, BBC, and Warner Bros. money. It also hasn’t made payments to some streaming platforms, its landlords and the company it rents cars from.

It currently has $970 million in debt, it said on its bankruptcy filings.

Making matters worse, employees at Chicken Soup for the Soul have been waiting to be paid since June 21st, The Verge reported. Employees also haven’t had health insurance since May.

The company bought the DVD renting service Redbox in 2022, taking on $325 million debt. It still has more than 34,000 red DVD kiosks, CNN reported, but the DVD business is in trouble and its plan to combine Redbox with the free streaming service Crackle never materialized.

It had more than 1,000 employees at the end of 2023, according to Deadline. Shares of the company were sitting at a meager 12 cents on Monday morning.