Scour Files for Chapter 11 Bankruptcy

Embattled online entertainment company Scour (www.scour.com), whose investors include former Disney executive Michael Ovitz, said today it has filed for Chapter 11 bankruptcy.

Scour's services, which include Napster-like file-sharing software and a multimedia Web search engine, said it made the move "to ensure its continued operation in the face of burdensome lawsuits."

"We took this step in order to preserve Scour's future," said Scour President Dan Rodrigues, in a statement. "The Chapter 11 process will also provide our management and board of directors with adequate time to review and develop recapitalization and restructuring alternatives to strengthen and improve Scour's business position."

The company was sued in July by the motion picture and recording industries, which alleged widespread copyright violations from the Scour Exchange software. The costly lawsuit eventually led to the company laying off 52 of its 64 employees in September. But Rodriguez said in the statement today that the Scour Exchange software will continue to be made available on Scour's website.

In the Chapter 11 petition, filed at the U.S. Bankruptcy Court for the Central District of California in Los Angeles, Scour said it owed between $1 million and $10 million to as many as 199 creditors.