Dr. Phil's company filed for bankruptcy, but a judge quickly converted it from Chapter 11 to Chapter 7 liquidation after suspecting insider favoritism. He opened a new company the day before filing and allegedly moved assets to it, a potential fraud scheme the trustee can now investigate and reverse.
Phil, he just— his company just filed for bankruptcy.
Dr. Phil's company filed for bankruptcy, laid everybody off, filed for Chapter 11, which is a reorganization. So it's where you're supposed to reorganize. And the judge saw through it right away and said there's no reorganization here, converted it to Chapter 7, which is liquidation. And it came out that they were trying to pay certain creditors and insiders instead of paying all their creditors. So there might be something that comes from that. The Chapter 7 trustee has the right to go sue people that receive money. And the day before they filed bankruptcy, Dr. Phil opened another company. Ain't that fraud? It doesn't look good because—
Well, you can't say that, but I'm saying that sounds like fraud.
It will definitely be investigated because there's something where if you have a company, you can't take all the assets out of that company, put it in another company, and then file bankruptcy for that company. They call it an alter ego. Basically, it's the same company. You're just leaving the debt with one entity and then taking the assets to the other. So it certainly will be investigated. That's why they put a Chapter 7 trustee. That's a fiduciary that comes in, looks through everything. They hire professionals, they'll track all the money and they'll see what—
See, that's why I want you to talk to Phil. That does not feel good. And then you laid all them people off. He's a therapist and you laying people off and causing all this stress because you don't know how to manage money in your company. That is messy.
