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Topic: PR bankruptcy - speak or stay silent?
| Author | Message |
| tmartin | Posted – 11/28/2008 3:47:14 PM | show profile I received word of the bankruptcy of a certain public relations firm based in Manhattan from a friend of mine a few weeks back. She's a realtor who also deals with travel marketing and had client properties herself in a certain part of the world whose national tourist board was in turn repped by this Manhattan PR firm. In relating this news, she emphasised "Don't tell anyone!" Well, poor thing, she's kinda far down the food chain herself for such an event to be anything very exclusive in terms of who knows about it. But then I asked another friend of mine who's also a journalist if I could use this information to pass on as a possible lead to other existing PR firms I deal with frequently and who I like very much for their professionalism, so that they could approach some of the clients of this bankrupt PR firm. He responded first that "You would be seen as gossiping" but then after further discussion he said *if* it was framed as part of a discussion where I could be seen as trying to discreetly pass on some useful information in a friendly way that could benefit them, it might be a doable thing. What do you think? I'm having an after-work drink with one of the publicists at one of the PR firms next week. I suspect it may be old news about this bankruptcy, but who knows? I would like to help them out in lean times, but I don't want to be viewed as the town crier about stuff in their industry. |
| eriksherman | Posted – 11/28/2008 4:27:49 PM | show profile | email poster A company is only in bankruptcy if it formally files for such with the bankruptcy courts. At that point, the whole business is public information - there is nothing secret about it. Every single vendor of the agency, whether currently owed money or now, will have likely received notification from the courts. I would walk carefully, however. What if your friend *thinks* that the firm is in bankruptcy but it is not? You could be accused of slander if saying that it is. (A blogger in south Florida just got hit with this, having said that a given developer was bankrupt when the person, although in heavy financial trouble, had never filed.) If the firm is incorporated in NY, then a call to the bankruptcy court that has that part of the state in its district should provide an answer. ------ Free writer resources: http://www.eriksherman.com/WriterBiz |
| dribbledrive1 | Posted – 11/28/2008 4:43:29 PM | show profile It may be that your friend doesn't really know all that much and might be passing along some iffy gossip. I wouldn't pass along what she said to you as if it were gospel when you really don't know the facts yourself. At best all you could say was that you'd heard something vague about the PR firm being in financial trouble, but you don't know if they're going to declare bankruptcy or if their clients are going to be up for grabs. |
| tmartin | Posted – 11/28/2008 5:01:47 PM | show profile I don't know if they've filed the actual bankruptcy. However, they've defaulted on performing the services to their clients because their AE's are already out of a job. No one answers the phones live anymore, although the website of course gives the illusion of corporate presence. The really unknown part is whether they've taken monthly or any other advance retainers and also defaulted on not returning those moneys. If so, then the former clients would be looking for representation elsewhere rather than continuing a relationship with a questionable former member of a firm that would probably be desperately trying to hang on to the client in a new company guise. |
| Grateful Deadline | Posted – 11/29/2008 12:54:21 PM | show profile Are you inside the company or outside it? It sounds from your first post as if you're outside it. It sounds from your followup post as if you're reaching all sorts of conclusions, based on what a Realtor friend "kinda far down the food chain" told you was hush-hush, to justify what you want to do. How do you know the cutbacks are not the company's way of regrouping in this economy? How do you know for certain that the company's breaching contracts with its clients and taking a hit over it? How do you know the clients are in the dark and need you to inform them that they have options? How much solid information can you give them? How credible is your information, considering it comes from a Realtor (not even with that company) and would now be passed along by you? All questions for you to answer, to yourself, before trying to commit the coup de gras on "a certain public relations firm." |
| tmartin | Posted – 11/29/2008 5:49:40 PM | show profile If you'll read what was said previously...I haven't reached any conclusions other than what has been stated to me as a fact. Namely, they've let go AE's, they have told a client that they could not manage to fulfill their contractual obligations because they were no longer operating as a company. As eriksherman pointed out, the central thing in total doubt is when they'll file the bankruptcy. Any "coup de grace" was performed by them up on themselves, I'm not even a bystander at this point. My only interest was in possibly alerting another firm's publicist that the accounts might indeed be up for grabs in the near future. Consider that another aspect of how the "unseen job market" often works, especially in this economy. However, I also have a more first-hand interest in knowing what's going on because that former firm repped at least three tourism boards of destinations I had plans in '09 to possibly visit and revisit, so it's kind of basic for me also to know what or who is representing them at this point. |
| Grateful Deadline | Posted – 11/29/2008 7:02:30 PM | show profile >>Consider that another aspect of how the "unseen job market"<< What's the position? I'm thinking that, since PR and publicity often involve confidentiality regarding behind-the-scene stuff, you may put yourself in a tough one. |
| maphop | Posted – 11/30/2008 2:04:05 PM | show profile I wouldn't go there. Whether the firm has filed BK or not really doesn't affect you and if they have then, as someone's aready pointed out above, it's public record and the firm you are friendly with can do what they will. To be honest, this isn't any of your business especially what retainer agreements this firm you are not associated with may or may not have with their clients. Worse, your stepping into this can put your own reputation on the line; no matter what happens, no one will trust you in the future. If the firm experiencing difficulty lives on, you will be on their black list forever and, to be honest, there are few firms out there right now who are not struggling. Many clients are paying slowly or trying to negotiate slimmer contracts with their PR firms so you have no way of knowing whether their layoffs are simply prudent if unfortunate business decisions in light of the current economy. I would focus on your own business interests and leave the rest to the universe. |
| Cyrus | Posted – 11/30/2008 4:23:52 PM | show profile Generally speaking, there's no such thing as a company's PR account not being "up for grabs" anyway. Most contracts have termination clauses that allow a client to leave a firm, provided they give sufficient notice. Also, chances are any clients of the firm in question are probably being targeted by competitors anyway, given the current economic situation. Given that, what you're perceiving as a valuable tip might not have that much weight after all. Many companies now issue formal RFPs when they're reviewing relationships. If someone's being repped by a firm that goes out of business, I would imagine most of its clients worth having will do the same. ------ Cyrus Afzali Astoria Communications www.astoriacomm.com |
| hammer1 | Posted – 12/1/2008 3:52:48 PM | show profile I don't see anything... ...wrong with you sitting at the bar with this person and saying, "I hear that X firm is having problems. Have you heard anything?" That person will say "Yes" or "No"...either way what you hope to accomplish has been accomplished: letting this person know that something is afoot. As for "gossiping"...that's how most story leads in America are generated. That said, I wouldn't claim someone had filed Ch. 11 (or worse yet Ch. 7) unless I saw the court filing. One other note: they may not file in NYC...Delaware is the place to file. It's cheaper. |
| Cyrus | Posted – 12/1/2008 7:21:32 PM | show profile locale for bankruptcy filing You don't get to pick where you file bankrupty. Regardless of a company's form, any bankruptcy would have to happen where the company is regustered. In most every state I know of, unless you literally just use your name as your biz identity, you have to file papers with either your county or state. ------ Cyrus Afzali Astoria Communications www.astoriacomm.com |
| maphop | Posted – 12/2/2008 10:09:57 AM | show profile I believe that Cyrus is accurate. Where a company chooses to incorporate may have an impact on corporate expenses and taxes - which is why Nevada, Delaware and Wyoming are popular incorporation states - but does not impact where a BK must be filed. Although the federal government has regions where the ultimate paperwork for a bankruptcy filing might reside, I believe that the actual bankruptcy filing must take place and be made public in the state in which the filing company has offices. |
| tmartin | Posted – 12/2/2008 11:35:35 PM | show profile maphop: If you knew so much about bankruptcy or corporate matters then you'd know that if the corporate officers reside outside of state they would also need a corporate agent within state, i.e, as is the case with Delaware, where you can pay a fee to an agency in Dover to be your corporate office of record. For that reason, a bankruptcy would have to be filed in the state where you're incorporated not just where you "have offices". |
