Nasty Gal files for Chapter 11 bankruptcy protection


Los Angeles-based women’s clothing retailer Nasty Gal Inc. has filed for Chapter 11 bankruptcy protection.

Chief Executive Sheree Waterson said the move will help the company address “immediate liquidity issues,” as well as restructure its balance sheet and correct “structural issues” such as high occupancy costs.

“We expect to maintain our high level of customer service and emerge stronger and even better able to deliver the product and experience that our customers expect and that we take pride in bringing to market,” she said in a statement Wednesday.


Nasty Gal estimated both its assets and its liabilities at between $10 million and $50 million in its filing Wednesday with the U.S. Bankruptcy Court for the Central District of California.

Tech news site Recode also reported that founder Sophia Amoruso was resigning as the company’s executive chairwoman. Nasty Gal did not respond to The Times’ questions about this issue.

The provocative retailer got its start in 2006 when Amoruso began selling vintage clothes on EBay. It has since expanded beyond its e-commerce roots by adding two bricks-and-mortar retail stores in Los Angeles.

In an interview with The Times in 2014, Amoruso described Nasty Gal’s store on Melrose Avenue as “a curated experience that combines the best of what we’re designing with the best vintage and the best of other brands.”

Amoruso has also published a book, “#Girlboss,” which chronicles how she founded Nasty Gal and her business philosophy. The book made the New York Times bestseller list.

Nasty Gal said it has been looking into “strategic partnerships with other strong brands” and will continue doing so throughout its restructuring process.

The company also said it expected to attract a “new equity partner or sponsor to take the company forward with a healthy balance sheet,” though Nasty Gal emphasized that it plans to emerge from Chapter 11 and continue operations with or without such a partner.

The retailer said that customers and employees shouldn’t see any changes in daily operations and that it plans to ask for early court approval of a plan to “assist in strengthening its relationship with its current vendors and business partners.”

Nasty Gal is facing an increasingly crowded retail landscape, especially with fast-fashion competitors such as Forever 21 and H&M, which can churn out new styles quickly and at cheaper prices, said Paula Rosenblum, co-founder and managing partner at RSR Research.

“Restructuring is always a good thing because it helps you rebalance,” she said. “They need to reinvent themselves a little bit, continue to interest their core audience without losing it and find economies so that it’s a sustainable business model.”

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11:10 a.m.: This article was updated with an analyst’s comments and details about Nasty Gal’s estimated assets and liabilities.

This article was originally published at 10:15 a.m.