By Ryan C. Wood
Every now and then while I wait for my client’s case to be called at a 341 meeting of a creditors an interesting business bankruptcy case is called first. Unfortunately today that case was for Juno Baby, Inc. Juno Baby, Inc.’s bankruptcy attorney filed their petiton for bankruptcy protection under Chapter 7 of the Bankruptcy Code on December 21, 2012, Bankr. Case No. 12-33574.
I remember when this Juno Baby first started appearing because my brother had just welcomed his first child into the world in 2008. They were researching all kinds of learning tools for their first child. They liked the concept of songs and music teaching their child. What a great idea. Juno Baby was one that came up. Also with the happenstance of life I had a client who owned stock in Juno Baby, Inc. as well.
According to testimony by a former Juno Baby, Inc. CEO at Juno Baby, Inc.’s 341 meeting of the creditors today, Juno Baby, Inc. unfortunately did not catch on like you would think. According the California Secretary of State Juno Baby, Inc. was incorporated on April 16, 2009. The original founders basically sold all of the intellectual property of Juno Baby, LLC to Juno Baby, Inc. There were approximately three rounds of funding to start Juno Baby, Inc. The total amount of investment capital raised was around $4.2 million. According to their former CEO, Juno Baby, Inc. has not operated since 2011. An interesting twist that came up was the timing of the launch of the business and the emerging use of smart phones and launch of the IPAD. Originally Juno Baby, Inc. was focused on producing content in the form of DVDs. The shift was on to other platforms and apps with the Apple Store.
The bankruptcy schedules list $352,816 in assets and $6,913,903.00 in unsecured debts. Most of the assets are in the form of inventory totaling $331,806.00. What is clearly unknown in this case is: What is the value of the intellectual property such as the copyrighted content produced by Juno Baby, Inc.? Unfortunately for creditors there may not be any market out there to sell the intellectual property. There are number of creditors that are owed money such as Amazon.com. The single largest creditor is Peter Dal Pezzo for a loan totaling $6,681,742. Mr. Dal Pezzo’s claim represents 96.6% of the total claims against Juno Baby, Inc. If you are a bankruptcy lawyer representing a creditor it will be interesting whether the intellectual property created can be sold off to another company or individual for the benefit of creditors. Only time will tell. For now it marks the end for a once promising concept under the name Juno Baby. I do not think my brother ever ended up purchasing any of their products also. He probably owns some Baby Eistein stuff though.