The iconic imaging and photography company Eastman Kodak is preparing to apply for bankruptcy protection, The Wall Street Journal has reported.
According to the WSJ article on Wednesday, Kodak is trying to stave off bankruptcy by selling its patent portfolio, but is nonetheless preparing for a Chapter 11 filing in the event of this tactic not working.
Chapter 11 bankruptcy usually leaves the failed business's owners in charge, but under the oversight of the US court system. It allows for major restructuring of the business while putting existing litigation against the company on hold — ultimately, though, if the business has more debts than assets, the creditors get to take over.
According to the WSJ, Kodak is looking to offload around 1,100 of its patents, hopefully before having to file for Chapter 11, but otherwise as part of bankruptcy proceedings, under the court's supervision.
The 131-year-old firm has not itself commented on the story, which was credited to unnamed WSJ sources. Following the article's publication, Kodak's share price dropped by 28 percent on the New York Stock Exchange.
Eastman Kodak has been responsible for an extraordinary number of innovations, from roll film to 35mm colour film to the digital camera itself. However, the company was far too slow to make the move to digital, and retained a reliance on film sales that proved disastrous during the early 2000s.
Kodak became arguably better known for its inkjet photo printers than its cameras, but it also become increasingly litigious, using its rich patent portfolio to generate money.
In 2009, it forced Samsung and LG into lucrative licensing deals. The next year, Kodak took on Apple and RIM for their alleged infringement of its image previewing patents.
There have been multiple delays in this case, largely due to the retirement of the administrative law judge who issued the preliminary judgement. The target end date for the ITC investigation was, just before the New Year, put back again (PDF) to 21 September 2012.