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After an emergency fundraising campaign seeking to offset several years of declining revenues came up short, The Big Apple Circus Ltd. filed for Chapter 11 protection Sunday, naming Debeviose & Plimpton as its lead bankruptcy counsel.
Natasha Labovitz, co-chair of Debevoise’s business restructuring and workouts group, and business restructuring counsel Christopher Updike are listed as debtors’ counsel to the circus in its bankruptcy petition. The duo will advise the circus on a pro bono basis, said a Debevoise spokesman.
The Big Apple Circus, a Brooklyn, New York-based nonprofit founded in 1977, struggled financially in the aftermath of the economic downturn several years ago, executive director Will Maitland Weiss told The American Lawyer in July. Many large companies, law firms and financial institutions that once rented out the tent for their employees and clients around the holidays have stopped doing so, depriving the circus of a large source of its annual revenue.
Paul, Weiss, Rifkind, Wharton & Garrison and Cravath, Swaine & Moore were among the firms that rented all 1,600 seats in the tent, which cost between $50,000 and $100,000 depending on the day of the week. O’Melveny & Myers also used to rent the tent, but, like a number of companies, stopped doing so in 2011.
Court documents state that before 2008, the circus could earn $2 million a year by renting the whole tent to about 20 companies and financial institutions for private performances during the holidays. But now less than 10 companies rent the tent for private events, which partly accounts for the nonprofit’s drop in income from performances from over $18 million in the 2007-08 season, to $11.9 million in 2016.
The nonprofit launched a fundraising campaign last summer in an attempt to raise $2 million by the end of July. Though 1,400 donors contributed, the fundraising goal wasn’t met, according to court documents. That caused the circus’ 2016-17 season to be canceled. (A benefit at New York’s Lincoln Center a year ago this week sponsored by Boies, Schiller & Flexner—litigation partner Robin Henry has served on the circus’ board of directors—raised $420,000 for the struggling circus.)
The Big Apple Circus is downsizing its community programs, which include Clown Care, one that sees performing artists visit and entertain children in hospitals. The programs may be transitioned to other nonprofits, while the circus said it would like to preserve the opportunity to restart the main show under a new owner, according to court documents.
A Debevoise spokesman said the firm has provided pro bono services to the circus for many years, but declined to discuss exactly what that past work has entailed.