UPDATE 1628:Chicago Reader enters Atalaya Era after Creative Loafing loses its last bid in bankruptcy court (Chicago Reader)

UPDATE 1535: Creative Loafing chain sold to biggest creditor for $5 million (Atlanta Journal-Constitution)
UPDATE 1459: Washington City Paper Now Owned by Atalaya Capital (DCist)
Atalaya outbids Eason, assumes control of Creative Loafing (Creative Loafing Tampa)
UPDATE 1332: Hedge Fund Atalaya buys Creative Loafing in equity auction (Tampa Bay Business Journal)

UPDATE 1256: New York equity firm snaps up Tampa's Creative Loafing (Tampa Tribune/TBO.com)

UPDATE 1240:Chicago Reader Has New Owners (Chicago Reader)

UPDATE 1236:Tampa's Creative Loafing chain taken over by hedge fund Atalaya (St. Petersburg Times/tampabay.com)

UPDATE 1229: Atlanta Creative Loafing says Atalaya won.

UPDATE 1223: Chicago Reader calls it for Atalaya.

UPDATE 1218: Unconfirmed Twitter chatter is that Atalaya has won.
Read More "Who Will Own City Paper? We Just Found Out" »

Sex Day! We blogged it. Some of my faves: Cherkis'  trio of prostitute posts. Darrow's Lorton pics. Riggs on the bike/porn shop. Godfrey! "I felt like Dad at the dinner table passing out money to his daughters." McKenna on one of the weirdest houses in D.C. "For people with boobs, the hook-up potential is at its highest: 10. For people without boobs, you’re looking at about a 6." Really, really great stuff, and a big hat tip to Amanda Hess for organizing something well out of much of the staff's comfort zones. If there's anything you'd particularly like to see (or not) in the paper next week, e-mail me.

After the jump: My favorite Post blog, old music. reality Realty, our parent company may need a CEO

Read More "Morning Roundup: The Morning After Edition" »

Our wacky company. Jesus, our wacky company. Today was the day a judge in Florida was due to decide how best to conduct an equity auction next month that'll presumably end our company's nearly yearlong journey through bankruptcy. She kind of punted.

But: Talk about burying the lede! Following the ruling, Creative Loafing CEO Ben Eason said he was considering stepping down as CEO to, as Wayne Garcia reports, "focus on formulating a new equity bid for the post-bankruptcy company."

This leaves us without a CEO. And in the absence of an obvious candidate, may I suggest our own City Lights editor, Mike Riggs? Some points:

Read More "Mike Riggs for CEO" »

A federal judge in Tampa has just ruled in favor of Creative Loafing Inc. CEO Ben Eason in a bankruptcy struggle with the company's main creditor, Atalaya Capital Management. Holder of $31 million in Creative Loafing debt, Atalaya was seeking to gain control of the company. The court denied Atalaya's motions and directed the two to figure out a reorganization plan for the company. Our sister paper in Tampa is following the story.

In Shaw writes on chickens in the city: "As I remember, I thought there were laws on the books that in one way or another say no to chickens. Just to make sure I checked The City Chicken, which according to it's chicken law page says, 'Washington D.C. Housing chickens here violates health laws and is not legal.'
Then I checked the online DC Code, plugging in Chicken, poultry and fowl...."

The Georgetown Metropolitan wonders: Does Jack Evans Abuse Parking Laws? There are incriminating photos of Evans' car clearly parked illegally---that is if he were just an average citizen. It is an open question whether he actually deserved a ticket.

Borderstan notes that construction has begun at the 17th-S-and-New Hampshire dog park. Post includes photos! Still, the project might be behind. The writer wonders: "I have not heard anything new on the opening date other than 'spring.' Anyone know anything more about a specific date?"

Bureaucrat310 chronicles a rough commute: "On this particular morning I was running late. Just as I descended into the columbia heights metro station I noticed that the next train would be arriving in 2 minutes. I hustle, run to the turnstile, swipe my card and get the dreaded 'go see a customer service agent' warning..."

Read More "Our Morning Roundup: Chickens Coming Home To Roost" »

Dan Snyder's juxtanothing theme park chain, Six Flags, is back in the news. For all the wrong reasons.

Snyder's sub-Mensa-esque brainchild, the network of stand-alone kiddie hair salons known as Six Flags Rollercoaster Cuts, opened its first outlet in West Hartford, Ct., and started hawking costly coif makeovers with dumbass names -- The Glammy, Zoink, Big Kapow and Blama Jama -- to breeders of young New England bluebloods.

Yet the liberal media was only tweeting about the parent company's economic woes.

Seems Vegas is torn over what will come first: Snyder's company going bankrupt or 64 1/2 seed Morehead State getting bounced from the NCAA Tournament. (Gimme Morehead in that pool!)

In a conference call with Six Flags investors this morning, Snyder's cohort Mark Shapiro pinned Six Flags' sorry chances for staying afloat on a failure to communicate with his major creditors.

I'm no Ben Bernanke, but I'd say the hole Six Flags finds itself in is probably related to both whatever communication breakdown Shapiro is whining about, plus the fact that his company is MORE THAN $2 BILLION IN DEBT!

Yet before we credit all of Six Flags' problems to Snyder's ineptness, let's gander at Mark Shapiro's portfolio.

Read More "Update: SIX Flagging" »

That's Rick Rodriguez, for all you morons who don't recognize the leading lights in the world of journalism. Rick Rodriguez is a journalism professor at Arizona State University and former executive editor of the Sacramento Bee.

Such credentials have landed Rodriguez a spot on the roster of experts discussing the future--or lack thereof--for newspapers on the New York Times Web site.

Rodriguez predicts a time of turmoil in the world of local news coverage, with dailies cutting coverage or folding and new competitors trying to fill the void. "For a while it’ll be the Wild West in terms of journalistic standards, the rise and fall of old and new enterprises and an endless pursuit of new business models."

But he's got good news for papers like this one: "Among the best bets for adhering to traditional journalistic standards will be smaller, already-established newspapers that can expand their local influence. Alternative weeklies and ethnic media mostly will survive, and possibly even thrive by specializing in coverage of fields like entertainment or local politics."

Is Rodriguez keeping up on our bankruptcy?

Last Monday, Creative Loafing, the company that owns Washington City Paper and five other papers, announced that it had filed for Chapter 11 bankruptcy. At the time, Creative Loafing CEO Ben Eason said, Chapter 11 was a "natural place for the Company to go to accomplish an orderly reorganization of our finances."

This move was occasioned by a dispute between Creative Loafing and its biggest creditor, New York- and Atlanta-based Atalaya Capital Management, which loaned Creative Loafing Inc. (CLI) $30 million to purchase City Paper and the Chicago Reader last year and to pay down $15 million in debt that CLI already held. (CLI also borrowed $10 million from BIA Digital Partners in Chantilly, Va., when making the purchase.)

As collateral, Eason pledged his voting shares (he owns 100 percent of the company's class A stock).

Yesterday, as Atlanta Magazine's Steve Fennessy first reported, Atalaya filed an objection to CLI's "emergency motion" for a temporary restraining order, claiming that Eason's stock was owned by him alone, not the company, and as such was outside the scope of CL's bankruptcy. Further, Atalaya contested CLI's assertion that Eason "provides the vision and direction for the Debtors’ viewpoints of various issues, including social, political and cultural, that are occurring in each of the Debtors’ communities."

Yesterday, Judge Caryl Delano of Tampa, Fla., where the case is in motion, disagreed with Atalaya.

Had the company been successful, it would have been able to essentially take over Creative Loafing. "It was a legal maneuver they were doing to get more control," says Eason, speaking from his office in Tampa.

"When we filed the bankruptcy," he says, "there was a concern that Atalaya or BIA might use the collateral as a part of the bankruptcy to come in the backdoor and use the shares to basically foreclose on the shares and function as the board of directors."

Atalaya says Eason is not the "only employee or officer of the Debtors capable of managing the business" and that CLI hasn't “suggested that Mr. Eason will contribute anything in the way of credit, money, or property to fund any proposed plan. Mr. Eason will contribute only his time and energies for which the Debtors have proposed that he continue to receive a significant salary and potential bonus.”

In one particularly memorable section of the filing, Atalaya gives examples of companies in Chapter 11 whose sole proprietor was "the only person who can run the business": one was the only physician at his chiropractic clinic; another was "the only person with trade secret knowledge of how to process codfish in the Caribbean." (Note: I am now desperately trying to work the phrase "it's hardly processing codfish in the Caribbean" into my everyday speech.)

Eason calls this "a bit of an aggressive move." He characterizes the first 10 days of the bankruptcy, as "Day 1" hearings, when the court unfreezes the company's assets one by one---its ability to use its bank account, its ability to pay employees, freelancers, vendors, etc. He characterizes these hearings as "Can we turn the lights back on?

Yesterday's ruling was part of what Eason calls "Day 2 proceedings." He says CLI now has "a total timeout for 110 days," during which time CLI management will get a reorganization plan together. "Essentially...the initial set up is done," he says.

UPDATE (FRIDAY, OCT. 10; 6:15 P.M.): Via Tyler Brown, an attorney for Atalaya, this statement.

Atalaya Administrative, LLC, ("Atalaya") is the agent for the lenders who hold the senior secured loan outstanding to Creative Loafing, Inc. ("CLI") and its affiliates, which are debtors in chapter 11 cases in the U.S. Bankruptcy Court in Tampa, Florida.  Atalaya is owed in excess of $30 million by CLI.

Atalaya believes that the bankruptcy filing was unfortunate and unnecessary. It is very important that management of CLI continue to operate the business in the ordinary course and that the bankruptcy have as little negative impact on CLI's operations, employees, customers and vendors as is possible. Atalaya wants the business to succeed and, despite whatever court actions may be required to protect Atalaya's interests, wants to assure all interested parties that Atalaya has no intention of attempting to shut down the business. Atalaya believes that the business can succeed with the right management and business plan in place.

So I guess I could have just gone to the big man himself. Earlier today I posted about the confusing, and concerning, documents filed by Creative Loafing, our parent company, in their application for Chapter 11 bankruptcy protection. Well, blogger Rob Capriccioso, aka Big Head Rob, took it upon himself to forward my post to the Loaf's main man, Ben Eason, who CC'ed me on the reply. Thanks, Ben. But I still don't quite get it.

I'd joked that I didn't understand the lingo in the filings. I never took Latin, for one. Turns out Ben doesn't get it either:

I think we’re all getting used to this Chapter 11 lingo. Not sure I know what nunc pro tunc is either. The filings are a little confusing due to the fact that we’re current with all our bills, taxes and payroll but when this weeks bills come in the mail, we’ll update the filing. Additionally, the law requires you to list all the taxing authorities and all the sister companies so this quickly becomes confusing to those who aren’t used to these proceedings.

I'd also expressed some concerns about Eason getting dinged by the court for failing to include a complete list of his creditors and debts. He doesn't explain to the blogger. The way he tells it, we've just run into a bit of a rough patch.

All our pubs are profitable and we’re growing nicely online – we just ran head first into a brutal economy that isn’t showing any signs of getting better anytime soon. The City Paper and CL are doing fine – this just gives us the time we need to keep building out our digital strategies.

In general, the future looks bright. (This is from an earlier email to Rob.)

The trust and presence that City Paper has in the DC market is phenomenal and we think that the combination of DC and Chicago with the CL company give us the national reach to play a significant role in emerging media across the country. We're now able to really get deep into 3 of the top 10 markets in the country and with our brethren in the alternative industry, we're able to compete against the Silicon Valley funded dot coms that are challenging traditional media companies.

Here we come Google, watch out.

Perusing the scanned documents from our parent company's Chapter 11 case, I'm finding a lot of lingo I don't totally understand (PDFs: Emergency Motion to Use Cash Collateral, Emergency Motion for Nunc Pro Tunc Authorization). But hey, here's one I think I get: Notice of Deficient Filing. It appears that Ben Eason's bankruptcy papers were missing a few crucial details, like a statement of financial affairs and a list of creditors with a schedule of liabilities. Eason's initial filing included a list of just the top 20 creditors (PDF: List of Creditors), and only one noted the amount owed: about $83,000 to the Fayetteville Publishing Co. Also missing, how much Eason's attorney will get paid and a case management summary. If Eason doesn't turn in the missing paperwork, the case could be dropped. I have a feeling that would be bad news for us all.

Actually, it looks like they did file a document showing how much the attorneys have already collected: a retainer of $185,000, a bit more than they told us we'd have to cut from the City Paper budget a while back.

This morning's Shelf Awareness has a few details from Olsson's Chapter 11 bankruptcy filing. The local bookstore chain claims $929,428 in assets and $1,951,629 in liabilities. The usual reasons are cited for the downturn, but controller Terence McCann expressed confidence about the future of the business in the filing (hence the Chapter 11 claim, not Chapter 7): rebuilding the chain, he writes, "involves raising working capital, seeking investors, reducing overhead costs, adding new merchandise, refurbishing stores, retaining leases where achievable or relocating to communities that will support the concept of an independent bookstore. We still think that Olsson’s has something to offer and can do business in this market."