Pat McGrath Labs Files for Bankruptcy, seeking Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of Florida, according to a petition dated Jan. 22, marking a dramatic turn for a once-unicorn beauty brand.
The filing, first reported late Sunday by Women’s Wear Daily, has pushed an anticipated asset sale off the calendar indefinitely. A company spokesperson said Pat McGrath Labs will continue operating while it works to reorganize its finances — a hallmark of Chapter 11, which allows businesses to keep the lights on as they renegotiate with creditors.
Asset Sale Paused, Operations Continue
Chapter 11 as a financial pause button
The postponed sale had been slated for Tuesday but is now on hold as the company restructures its balance sheet. Chapter 11 functions like a financial time-out, giving companies room to reset while maintaining day-to-day operations.
Court filings list estimated liabilities between $50 million and $100 million. In tandem with the bankruptcy petition, the company submitted emergency motions seeking approval to pay $426,402 to critical vendors and $689,324 to cover employee wages, salaries and other compensation.
