A federal judge today ruled Dr. Phil cannot clean his own slate with a Chapter 11 for his now dead Merit Street Media and the multi-million dollar deal he had with Trinity Broadcasting.
Scolding Phil McGraw for not being forthright in his deals and the recent trial, U.S. Bankruptcy Judge Scott Everett wants the proceedings transferred into a Chapter 7 and the assets sold off to pay off debts.
“Candor to the court is critical,” Judge Everett declared in the just completed hearing, noting how cruical communications had been erased and specific creditors to McGraw’s Merit Street Media were being paid over others The Texas-based judge also made it clear in the summary judgement ruling he thought McGraw was juicing one business to launch another as MSM “was as dead as a doornail when the bankruptcy was filed.”
“Mr. McGraw believed he was calling the shots.”
The verdict comes a couple of weeks after the Texas trial over the cursed $500 million deal between the one-time Oprah protégé and Trinity Broadcasting Network wrapped. On a parallel track, Dr. Phil’s joint venture Merit Street Media filed for Chapter 11 bankruptcy protection in July. The Matthew Crouch run faith-based TBN countersued in August, accusing Dr. Phil of “reprehensible conduct,” trying to play them for millions and tying to pull a fast one to get out of the once much hyped deal to bring the TV shrink to a new audience.
On McGraw’s side, this ain’t over.
“We respectfully disagree with the court’s ruling and take issue with its comments concerning Dr. Phil McGraw,” a spokesperson for the Dr. Phil-owned Peteski Productions told Deadline just before the virtual hearing ended. “Dr. Phil is a leader of the highest integrity whose actions reflect honesty, ethics, and a life-long commitment to helping people. We are reviewing all of our options regarding an appeal, which is likely.”
