Dr. Phil's Merit Street Media Ordered Chapter 7 Liquidation After Bankruptcy Loss

Dr. Phil McGraw's media company, Merit Street Media, has been ordered by a U.S. bankruptcy judge to convert its Chapter 11 bankruptcy case into a Chapter 7 liquidation, signaling the company's dissolution and the sale of its assets to pay creditors. The judge cited that there was "no hope for rehabilitation" for the company and criticized McGraw for deleting incriminating text messages that revealed a plan to prioritize payments to "favored creditors." Merit Street Media, launched in 2024 in partnership with Christian broadcaster Trinity Broadcasting Network (TBN), filed for bankruptcy amid lawsuits accusing each other of breach of contract and fraudulent schemes. Additional claims include Professional Bull Riders (PBR) alleging Merit Street owes $181 million after pulling its programming due to non-payment, and concerns over Merit Street's bad faith bankruptcy filing. The judge's ruling underscored concerns that McGraw created a new company with similar programming prior to bankruptcy, potentially moving assets out of creditor reach. McGraw's production company plans to appeal the ruling, while the ongoing legal battles highlight serious financial and ethical controversies surrounding the media venture.