Washington Blade Gay Newspaper Lives on After Parent Company’s Chapter 7 Bankruptcy

The Washington Blade, a newspaper by and for the gay community in Washington, D.C., seemed like it would be no more after its parent company filed for Chapter 7 bankruptcy in December of 2009.

But the paper has, in its own words, risen “from the ashes,” and continued to operate under a new set of owners: former employees of that parent company, Window Media.

In an article published in the Washington Blade itself, new details have emerged about the Window Media dissolution that concluded last December. The Chapter 7 bankruptcy liquidation meant that the Blade would close its doors after 40 years in the news business, and some feared that it wouldn’t be back.

But it turned out that Window Media’s liquidation opened the door for a group of Blade employees to form their own company and rebuild the paper from the ground up. This new company was even able to purchase the Blade trademark, as well as some other assets from the bankrupt parent company. They even acquired these assets at a bargain price.

The Blade has been back in operation for around six months now, though some of that time was spent publishing under the name DC Agenda.

After the dust settled surrounding the bankruptcy of its parent company, court papers came out that gave some insight into the process that led to the liquidation, as well as revealing some unsettling details about the treatment of Blade archival information.

It turns out that, unable to pay the bills for server space, Window Media allowed a contract with an IT company to lapse. The server company let the account slip away, and re-purposed the storage space on those servers for something else. The information that got deleted? It turned out to be all of the electronic archives for the Blade newspaper, since 2001.

“Like any customer, they were delinquent on their payment. The service was canceled,” said Kevin Soendker of Inet Services, the IT company that didn’t get paid for the server space.

There are still paper editions of all of Blade’s issues, going back to its first issue put out in October of 1969, and the data loss has led to the establishment by Blade’s current owner, Brown Naff Pitts Omnimedia of a non-profit organization, the goal of which is to raise funds to digitize and make public all of Blade’s back issues.

There was much more legal wrangling surrounding the bankruptcy that came to light, as Window Media’s parent company, Avalon Equity Fund, defaulted on millions of dollars in loans from the U.S. Small Business Administration (SBA). The SBA subsequently took control of Avalon, and had a big say in what happened with Window Media’s liquidation.

As a result of the wrangling, Window Media had to get approval from the courts to file for bankruptcy. They got that approval in late 2009, and Blade employees were shocked. They had hoped that the paper would have been put up for auction, rather than shut down and liquidated.

They took action, and formed a group featuring the paper’s publisher, editor and sales executive that would buy the paper.

Vowing not to be stopped, employees of the paper put out a new edition on the same Friday that the chapter 7 bankruptcy was announced, under the name DC Agenda.

The group’s bid was the only one, they received the naming rights and other assets, and now the Blade is publishing again.

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