Forced to cut hours and facing the possibility of competition, the owners of Pink Pony strip club filed for bankruptcy on Wednesday.
Chapter 11 is known as “reorganization” bankruptcy, allowing a business to restructure its debts while remaining in operation. Pink Pony’s filing is listed under parent company Trop Inc.
The company’s biggest debt is $1 million owed to a Louisiana bank. A list of the company’s 20 largest liabilities appears to include either current or former employees.
Pink Pony executives have said business has suffered ever since three Buford Highway nightclubs filed a lawsuit to challenge Brookhaven’s new liquor law. A federal judge ruled that the law was likely unconstitutional, mainly on the grounds that the city had allowed Pink Pony to operate under different rules than other nightclubs.
As a result, Brookhaven forced Pink Pony to reduce its hours to match the other clubs. The city also rolled back the disputed law and ended its ban on alcohol sales at strip clubs.
That change was intended to make it legal for Pink Pony to operate through the end of its six-year agreement with the city. But other adult-oriented businesses will be allowed to apply for liquor licenses as a result.
Pink Pony executive Dennis Williams did not immediately respond to a text or email to discuss the bankruptcy filing. It is not clear how much the recent changes in Brookhaven affected the club’s bottom line.
However, during a City Council meeting last month he said Pink Pony was struggling.
“My hours have taken a beaten,” Williams, the executive vice president and chief financial officer, told council members. “We’ve become a victim, and I’m having some financial hardships.”