Dr. Phil's Media Company Files For Bankruptcy

Merit Street Media, a television and multiplatform media company launched by TV personality Dr. Phil McGraw in April 2024, aimed to provide content focused on “traditional family content,” news, sports, true crime, and more. 

The Fort Worth, Texas-based venture was formed as a joint venture between McGraw’s Peteski Productions and Trinity Broadcasting Network (TBN), a Christian media giant with a global network of 30 channels. The partnership was intended to leverage McGraw’s flagship program, Dr. Phil Primetime, alongside other programming featuring personalities like Nancy Grace, Bear Grylls, and Steve Harvey, with TBN providing national distribution and production services.

On Wednesday, Merit Street Media filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Texas, citing a “severely strained liquidity position” and an inability to secure additional outside capital. 

Simultaneously with the bankruptcy filing, Merit Street Media filed a lawsuit against TBN, alleging breach of contract, breach of fiduciary duty, and breach of the duty of good faith and fair dealing. The lawsuit claims TBN, as the controlling shareholder, failed to fulfill its contractual obligations, which directly led to Merit Street’s financial collapse. 

Key allegations include:

Failure to Provide National Distribution: TBN was contractually obligated to provide “must carry rights” and access to its extensive distribution network at no cost to Merit Street. However, the lawsuit alleges TBN withheld distribution payments, which were explicitly its responsibility, causing Merit Street to lose national distribution. This left the network unable to broadcast its programming, effectively “going dark.”

Costly Third-Party Deals: TBN allegedly forced Merit Street into expensive distribution agreements with third parties, such as cable providers, costing the company $96 million to over $100 million in unsustainable debt, despite TBN’s ability to distribute through its own network of local TV stations.

Substandard Production Services: Merit Street described TBN’s production services as “comically dysfunctional,” citing issues like screens and teleprompters blacking out during live shows, an incomplete control room operating out of a truck, poor cell coverage in the studio, an unusable viewer app, and amateur video editing software. These failures compromised the quality and viability of Merit Street’s programming.