WINNIPEG -- After a string of sexual crime allegations and legal troubles that have ensnared its founder, The Nygard Group of Companies is facing its latest challenge: a corporate restructuring.
The women's fashion company said Tuesday that it is seeking financial support and protection by filing a notice of intention to file a proposal under the Canadian Bankruptcy and Insolvency Act "in order to protect the livelihood of thousands of dedicated employees."
"The fact that the company has made such a filing does not mean that the company is bankrupt or in receivership. Rather, the company is committed to positioning itself for long-term financial stability and is developing a restructuring plan that is acceptable to the company's various stakeholders," said a release from Nygard sent to The Canadian Press.
"In the interim, it is 'business as usual' at the company and at its retail stores."
The notice of intention comes almost a month after nearly a dozen women filed a class-action lawsuit against the company's founder Peter Nygard, who came to Canada as a child from Finland with his parents in 1942 and eventually built a fashion empire that landed him on several lists of the richest Canadians.
The women accused Nygard of luring them to his Bahamian mansion under the pretence of modelling opportunities in order to sexually assault them.
Several plaintiffs in the suit said they were 14 or 15 years old when Nygard gave them alcohol or drugs and then raped them.
Through a spokesperson, Nygard has vehemently denied all claims.
"Nygard and the company look forward to exposing the extent of the alleged conspiracy, clearing Nygard's name and the company brand, and restoring the company to its former glory," the Tuesday statement said.
Nygard stepped down from his company in February after the lawsuit and following an FBI raid on the company's New York headquarters.
Nygard has long blamed his troubles on Louis Bacon, the billionaire hedge fund manager who owns an estate next door to Nygard's in the Bahamas. The pair have feuded for years over various matters.
Nygard filed a lawsuit against Bacon alleging he paid people to make false statements against him in hopes of "ruining him and his business."
The Tuesday statement said the women's accusations have caused the company to be "maliciously battered" and a "devastating media onslaught."
As a result, "a significant Nygard customer ceased doing business with the company," the statement said.
The statement does not name which customer Nygard is referring to, but American retailer Dillard's Inc. dropped the brand's clothing from its department stores last month.
Nygard also noted that one of the company's financial lenders has demanded immediate payment of its outstanding credit facility.
"While the company arranged to replace this credit facility and actually secured a new lender, its prior lender inexplicably refused to wait a few extra days for the new credit line to be finalized and instead took aggressive steps which threatened the existence of the company and its thousands of employees, retailer customers, vendors and suppliers," said the statement.
"In response to these pressures, the company has determined that the NOI is the best option to provide the protection needed while all alternatives are assessed."
-With files from The Associated Press.
This report by The Canadian Press was first published March 10, 2020.