On the heels of an array of fashion and retail bankruptcy filings that began to unfold over the course of the year in 2016, New York-based designer Bibhu Mohapatra and retailers The Limited, Wet Seal, and Payless all made headlines when they filed for Chapter 11 protection in early 2017. They were swiftly followed by a handful of additional filings by other retailers, signaling that there is no end in sight to the constant string of fashion and other retail companies struggling financially and looking to bankruptcies courts for protection from their creditors.
For the uninitiated, Chapter 11 bankruptcy – one of the most commonly utilized forms of bankruptcy – allows a company to continue operating while it executes a reorganization plan. Chapter 11 can take a number of forms, but in short: A chapter 11 case begins with the filing of a petition with the bankruptcy court by the debtor (the entity that owes the debt – aka the retailers in the cases at hand). This is followed by the debtor proposing and executing a reorganization plan, which may be used to compromise or even eliminate certain classes of debt.
All the while, the debtor usually remains in possession of his assets and continues to operate any business, subject to the oversight of the court and the creditors committee. Typically, a company that has filed for Chapter 11 bankruptcy trying to stay in business, and as indicated below, this complex proceeding can be very effective in solving short term business problems in an otherwise viable company or winding down a company with valuable assets. (Also included below are instances in which brands have entered into administration, an insolvency process in the United Kingdom by which a company is “placed under the control of an insolvency practitioner to enable the insolvency practitioner to achieve objectives laid down by statute.”)
Fashion and Retail-Related Bankruptcies
Here is a look at some of the most recent fashion and retail-related bankruptcy filings …
June 2025 – CaaStle, Inc.
CaaStle, Inc. has filed for Chapter 7 bankruptcy in Delaware, initiating a full liquidation of its assets. The move comes just months after the abrupt resignation of CEO Christine Hunsicker, who is now at the center of a wide-ranging fraud scandal. The once-promising fashion rental platform cited untenable financial losses and leadership turmoil as key factors behind the decision. In its filing, CaaStle disclosed between $10 million and $50 million in both assets and liabilities, with as many as 999 creditors. The company indicated that after liquidation, funds may be available for distribution to unsecured creditors.
CaaStle’s remaining operations will be overseen by board member George Goldenberg, who stepped in as interim CEO following Hunsicker’s departure in March.
June 2025 – Hemper Enters Liquidation
Sustainable fashion brand Hemper has entered liquidation, underscoring the ongoing challenges facing mission-driven consumer brands in a competitive retail landscape. Founded to merge sustainability, transparency, and craftsmanship, Hemper gained early attention for its use of natural hemp fibers, artisanal production in Nepal, and commitment to ethical sourcing. The brand attracted a loyal customer base drawn to its environmentally responsible approach and handmade designs.
Despite positive consumer sentiment and rising demand for sustainable fashion, Hemper struggled to scale its operations while maintaining profitability. Supply chain complexities, rising production costs, and increased competition in the sustainable category contributed to mounting financial pressure. After evaluating strategic alternatives, the company ultimately filed for liquidation.
June 2025 – Fenice Retail
Fenice Retail, the retail arm of Fenice Srl, in which Italian fashion influencer Chiara Ferragni holds a 99% stake, has entered liquidation after posting combined losses of €1.2 million across 2023-2024, according to Radiocor. The closure includes Ferragni’s Rome store, following revenues of €644,000 and operating costs of roughly €2 million over the period. The company’s financial troubles have been compounded by Ferragni’s ongoing fraud trial related to allegedly misleading charity-linked product sales. After Fenice Retail’s liabilities pushed its equity into negative territory, a liquidator was appointed to wind up operations.
Separately, Ferragni injected €6.4 million to recapitalize Fenice Srl, which reported losses of approximately €10.2 million, allowing her to assume full control of the parent company. Ferragni said her relaunch plan will begin taking shape in the second half of 2025, promising “maximum transparency and reliability” in the group’s next chapter.
March 2025 – Forever 21
F21 OpCo, LLC, operator of Forever 21 stores in the U.S., has filed for chapter 11 bankruptcy in the District of Delaware and entered into a Plan Support Agreement with its secured lenders. The company said in a statement on March 17 that it plans to wind down its U.S. operations in an orderly fashion while exploring the potential sale of some or all of its assets. As part of this dual-path strategy, F21 OpCo will conduct liquidation sales and pursue a court-supervised auction process, aiming to maximize value and optionality. U.S. stores and the Forever 21 website will remain open during this process. Operations outside the U.S. are unaffected and will continue as usual.
“Following the conclusion of our strategic review and after careful deliberation, we made the decision to file for chapter 11 to implement a court-supervised marketing process to solicit a going concern transaction, and, in the absence of such an arrangement, an orderly wind down of operations,” said Brad Sell, Chief Financial Officer of F21 OpCo. “While we have evaluated all options to best position the Company for the future, we have been unable to find a sustainable path forward, given competition from foreign fast fashion companies, rising costs, and evolving consumer trends.”
March 2025 – Hudson’s Bay Co.
Hudson’s Bay Co. has filed for creditor protection in Canada as it moves to restructure amid mounting financial pressures. The historic department store chain, founded in 1670, cited economic headwinds, shifting post-pandemic shopping patterns, and trade tensions with the U.S. as key factors behind the decision. The filing under the Companies’ Creditors Arrangement Act will enable Hudson’s Bay to continue operating while working to stabilize its business.
In a statement, a Hudson’s Bay spokesperson said, “This decision was made with the best interests of our customers, associates, and partners in mind. Creditor protection will allow Hudson’s Bay to restructure financially and position itself for long-term success while maintaining its operations.”
The move does not affect Saks Global, the parent company of Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman, though Hudson’s Bay’s Canadian Saks locations will continue to operate under a licensing agreement. The company has secured interim financing from Restore Capital, LLC, and other lenders to support its restructuring efforts.
UPDATED (Jun. 3, 2025): In a $30 million deal approved by a bankruptcy court in Ontario, Canadian Tire has acquired Hudson Bay’s intellectual property, including its iconic multi-colored stripes, trademarks, domain names, and a trove of customer data from decades of loyalty programs. “Bankrupt Hudson’s Bay Co. will use the cash to pay some of its debts before the 355-year-old retailer disappears entirely,” according to CBC. The company wrapped up liquidation sales and closed its remaining 96 Bay and Saks-branded stores to the public on June 1.
January 2025 – Dancing Leopard
Womenswear brand Dancing Leopard has been placed in administration, with Birmingham-based insolvency firm Sanderlings slated to handle the proceedings. Founded in 2009 by Jade Hildreth and Jack Burrows, the British e-commerce company reported in financial documentation for the fiscal year ending on March 31, 2023, “The directors are aware that cash in the company has declined significantly in the year following a decrease in turnover and increase in expenses due to an operational change.”
This is a short excerpt from a data set that is published exclusively for TFL Pro+ subscribers. For access to our up-to-date fashion & retail bankruptcies tracker, inquire today about how to sign up for a Professional subscription.
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