By Ryan C. Wood
On March 30, 2012, ex-NFL star and broadcaster Warren Carlos Sapp filed for bankruptcy protection under Chapter 7 of the Bankruptcy Code, Bankr. Case No. 12-17819-RBR, in the Southern District of Florida. Like many before him bad business deals, unpaid income tax and mounting missed child support payments led to Mr. Sapp’s bankruptcy filing. Mr. Sapp’s petition lists $6,457,207.92 in assets and $6,724,631.62 in liabilities.
Also like many Americans Mr. Sapp has suffered from the mortgage crisis. M. Sapp owns two homes in Florida. One home is worth approximately $149,000 less than what Mr. Sapp owes on mortgage. The other house has over $1.3 million in equity. Florida is a state that has an unlimited homestead exemption to protect equity in your home if you are lucky enough to have equity in a home when filing bankruptcy.
Mr. Sapp schedules list quite a bit of personal property including approximately 10 annuities and life insurance policies valued at approximately $1 million. Mr. Sapp also has a NFL Annuity Program worth $439,450 and NFL Player 2nd Career 401k worth $469,812. One interesting note, which drives bankruptcy lawyers crazy, is that Mr. Sapp claims in his Schedule B that his 1999 National Championship Ring and 2002 Super Bowl Ring were both lost, not stolen, and neither ring was covered by insurance.
Mr. Sapp’s liabilities include unpaid child support or alimony totaling $885,000 to four different women, Akilah Akins, Angela Sanders, Jamiko Sapp and Sara Matt Lamothe-Kindred. Mr. Sapp has six kids ranging in age from 3 to 14 years old. The Internal Revenue Service is one of Mr. Sapp’s major creditors as well. Schedule E lists unpaid taxes for 2006 totaling $853,003 and 2010 totaling $89,775.
Mr. Sapp’s financial condition may become a lot worse. Mr. Sapp’s current monthly income includes the NFL Network: last contract payment ($45,000), CAA Sports: one-time appearance fee ($48,000), CAI Studios ($2,000) and Literary Agency East, book advance, ($18,675). If the NFL Network does not choose to renew their contract with Mr. Sapp it will result in Mr. Sapp having a negative monthly cash flow of approximately over ($100,000). His single largest monthly expense is child support and alimony totaling $75,495 per month. This represents about 60% of Mr. Sapp’s monthly expenses.
Like many Americans struggling with bills because of lost employment or a reduction in pay Mr. Sapp is no different. It is not about how much money you make each month, but how much you spend. Hopefully Mr. Sapp will have his contract renewed with the NFL Network. Without that income Mr. Sapp is going to have a hard time moving on financially.