In a bankruptcy filing published by CardPlayer on Thursday, Federated Sports and Gaming, the parent company of the Epic Poker League, reported nearly $8 million in liabilities. The “Statement of Financial Affairs” was issued to the United States Bankruptcy Court, District of Maryland – Southern Division and entered the books on April 3rd.
The nearly $7.9 million in liabilities consists of $2.1 million to creditors holding secured claims, $640,000 to creditors holding unsecured priority claims, and $5.1 million to creditors holding unsecured non-priority claims. The company listed its cash on hand at $37,000 and valued its acquisition of the still-operating Heartland Poker Tour at $4.9 million.
The company’s 64-page financial overview listed a variety of assets, including $12,000 in total accounts receivable from Time Life and the ASPCA, as well as personal property. The latter features $365,000 worth of domain names such as brunsoncup.com, epicblackjack.com, epicpokerstars.com, olecasino.com, palmspoker.net, pokernewsreports.com, wickedpoker.com, and worldwidepokerrankings.com. Seven pages of web domain names are listed in total.
Details of Epic’s agreement with the Palms in Las Vegas were also spelled out in the financial filing. The deal is valued at just shy of $2.8 million, which is “based upon one-year projected benefits under contract and assuming four events occur during that one-year period. Contract is for a five-year term. Value of benefits over a five-year term is estimated at $13,960,125.”
Other pieces of personal property outlined in the bankruptcy document include Federated Sports’ trademark applications, which encompass Epic Poker’s name, Epic Poker’s logos, Federated Sports and Gaming’s logos, and the Global Poker Index.
On the debt side, $2.1 million is owed to PNK Development 10, LLC, which is based in Nevada. CardPlayer detailed that PNK is “a subsidiary of Las Vegas-based regional casino operator Pinnacle Entertainment.”
Parties holding unsecured priority claims against Federated include the likes of co-founders Annie Duke (pictured) and Jeffrey Pollack and Vice President of League Operations and Programming Kat Kowal. Getty Images, the Disabled American Veterans, the Illinois Department of Revenue, poker reporters Jay Newnum and Jennifer Newell, Epic Director of Player Relations Jo Priam, the public relations firm Rogers and Cowan, and Savage Tournaments are all among the companies and individuals owed money.
According to CardPlayer and Chicago Business, Federated received a $2.5 million cash infusion from “an investment group that included J.B. Pritzker, principal owner of Hyatt Hotels Corp. and TransUnion Corp.”
CardPlayer added that several Federated Sports and Gaming executives were compensated six-figures during their tenure: “Since Federated Sports opened its doors, five Federated Sports officers were paid more than $1.1 million. Those officers include Annie Duke ($299,784), Jeffery Pollack ($226,652), Daniel Goldberg ($181,062), Jeffrey Grosman ($216,666), and Michael Brodsky ($166,666).” An Epic Poker-themed Facebook app also got off the ground last year.
Federated Sports’ documents contain a laundry list of bill payments, which revealed money sent to CBS Corporation in the amount of $200,000, the Hendon Mob in the amount of $8,148, the Palms Casino in the amount of $445,850, and PokerNews in the amount of $7,000, among other transfers.
Over on TwoPlusTwo, posters questioned Epic’s overall strategy given its executives’ salaries, multi-million dollar liabilities, and low cash on hand. One wrote, “I would love to get a look at whatever business plan they were peddling at the outset of this debacle. Forget about turning a profit. Just where did they expect to make the $1.1 million needed to pay their five top executives?”
Chino Rheem, Mike timexMcDonald, and Chris SLOPPYKLOD Klodnicki took down Epic Poker’s three Main Events that played out prior to the bankruptcy filing. In September, the league suspended Howard Lederer and Chris Ferguson after the Full Tilt Poker duo were hit with accusations of running a Ponzi scheme from the U.S. Government. It also put Rheem on probation due to what Epic called “financial obligations.”