AAF files for bankruptcy, discloses $48M in liabilities
The Alliance of American Football officially went out of business on Wednesday, filing for Chapter 7 bankruptcy in federal court in Texas.
The once-promising football league, which ended its inaugural season early last month amid reports of financial difficulties, listed liabilities of $48.3 million in the filing, which was first obtained by Front Office Sports. The AAF said it has less than $540,000 in cash on hand.
“The AAF is committed to ensuring that our bankruptcy proceeds in an efficient and orderly manner,” the AAF said in a statement. “Pursuant to the bankruptcy laws, a trustee will be empowered to resolve all matters related to the AAF’s remaining assets and liabilities, including ongoing matters related to player contracts.”
Co-founded by Charlie Ebersol and former NFL executive Bill Polian, the eight-team league debuted in February to solid television ratings. However, the AAF quickly ran into financial problems and sold a majority ownership stake to billionaire Tom Dundon, who became its chairman and promised $250 million in funding.
Dundon opted to pull that funding last month. At the time, the AAF said it had suspended operations because of its failure to reach terms with the NFL Players Association on a deal to use low-tier NFL players on its rosters. The league’s suspension of play caught employees and players by surprise, with many left to buy their own plane tickets home or cover their own medical costs.
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The AAF currently faces at least two class-action lawsuits, one from former players and one from former employees.