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Craft Magazine Shop (formerly All Craft Media)

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girlyswot

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To be avoided at all costs, from what I hear. The internet - and especially the online knitting community at Ravelry.com - is full of designers who haven't been paid, who haven't had samples returned, who've had their work published before any contract has been signed. And so on.
 

T. Nielsen Hayden

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I've been looking at the various online tellings of this story. The one to read if you're only reading one is All Craft Media, and Why You Should Run the Other Way, in a blog called Dull Roar.

Basically, Kellie Armstrong, operating as KAL Media, has been publishing a string of craft and needlework magazines:

Suspended publication:

- MagKnits
- Yarn Forward (renamed Knit Magazine; soon to be renamed again)

Current:

- Knit Magazine (see above)
- Inside Crochet
- Simply Beautiful
- Sew Hip
- Handmade Living
- Handmade Fashion
- Modern Quilting

There also are or were associated retail undertakings:

- Hipknits
- The Knit Magazine Sock Club

The knitting and textile arts world is a relatively polite and nonconfrontational place. For years, knitters have been quietly steaming over KLA paying late or never for published designs, failing to return their samples, and in some cases reselling their designs to other publications without giving the designer a share of the subrights. When KAL has sold yarn, shipments have been unreliable and often unsatisfactory, and there've been waaaaay too many instances of the post office supposedly losing outgoing packages.

The knitting community has increasingly been discussing its dissatisfaction with KAL. When designer Ruth Garcia-Alcantud published an open letter to an unspecified publisher, the community instantly recognized who she was talking about, and responded with a cascade of blog posts confirming and expanding upon the original.

This is good. They should have done it years ago, but it's good that they're doing it now. Needlework and crafts publications are a branch of publishing, and prone to the same problems that turn up elsewhere.

This is from Dull Roar:
Again, designers reported not getting paid for their work, or receiving their samples back in the mail, and, as is par for the course, not getting any sort of communicative response from the company. Finally, last summer/fall, designers began speaking out- on Ravelry, on Twitter, and on their own blogs. Some have been paid, albeit many months late. Some have not. Not just designers, either- tech editors, too. Many designers never got their sample back, despite promises to the contrary.

Owing a great deal of money, KAL Media went into liquidation. I don't know *exactly* what that term means legally in the UK, but what I do know is that the company was "bought" by All Craft Media, which is owned by Kerrie's husband, and apparently absolved of all debts. There were claims that ACM would honor the contracts and debts that KAL had racked up... but, as they are quick to point out, they aren't *obligated* to.

That's right- Kerrie and her husband are still profiting from magazines filled with designs from designers who were never paid, and telling the designers that they don't HAVE to pay them. Neener neener, suck it, designers.
Color me dubious about that liquidation. One half of a married couple declares bankruptcy, so the other half buys them out and dismisses the existing debts? I don't think so. It's the UK rather than the US, so I don't know nearly as much about the laws, but married couples are a legal unit, and unless they have formidable prenuptial agreements, they're an economic unit as well. Since ACM is a new company, and I haven't heard anything about Armstrong's husband being in the needlework business prior to its formation, I doubt it has that kind of separate status.

More simply, if this kind of maneuver were legal, couples could take turns buying out each other's bankruptcies every few years, and never have to pay their debts. More people would be doing it, and we'd have heard the outcry about it.

Here's my question for KAL's creditors: is there any independent confirmation that this liquidation actually took place, or did you just hear about it from Armstrong and her husband? It's worth checking. Consider chipping in on an hour or two of legal advice, and find out what your options are. Kellie Armstrong's many outstanding debts may still be collectible.

The other thing to watch out for is KAL/ACM starting new businesses in the same old way. I think what you have here is a serial scammer. They don't change their line of business unless they're forced to.
 

Momento Mori

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T. Nielsen Hayden:
Color me dubious about that liquidation. One half of a married couple declares bankruptcy, so the other half buys them out and dismisses the existing debts? I don't think so. It's the UK rather than the US, so I don't know nearly as much about the laws, but married couples are a legal unit, and unless they have formidable prenuptial agreements, they're an economic unit as well.

Unfortunately, the liquidation situation could very well be true. There was a law change in the UK a few years ago to allow for something called 'pre-packed liquidations', the idea of which was to make it easier for companies with good business but bad debts to close up but reopen as a going concern by allowing a buyer to purchase the company's assets but leave its debts. I've put a link to a site below that gives a plain English explanation of what it is but yes, the big disadvantage is that it effectively allows people who've run a business into high debt to escape them and set up shop all over again:

http://news.wilsonfield.co.uk/business-finance/prepack-administration-liquidations/14

T. Nielsen Hayden:
More simply, if this kind of maneuver were legal, couples could take turns buying out each other's bankruptcies every few years, and never have to pay their debts. More people would be doing it, and we'd have heard the outcry about it.

There has been more media coverage of it in the UK but it's mainly confined to the business sections because it's predominantly landlords and banks who get stuffed over on this and neither group are particularly popular at the moment. However there was a high profile case a couple of years ago when a Christmas club (basically an outfit that lets you pay into it over a course of a year and then gives you vouchers or hampers for use as Christmas presents) went bust and left thousands of ordinary people out of pocket a couple of months before Christmas.

In theory, the liquidator of the company is supposed to look after the creditors' interests and my suggestion (although I'm not an insolency practitioner) is that anyone who decides to continue to do business with KAL should make sure they're given the liquidator's details and put in a claim for the next time it decides to pre-pack. There's no limit on the number of times owners can do a pre-pack (that I'm aware of anyway), but if liquidators know that the owners have a history of doing so, they may decide that it's worthwhile putting the company into full and final liquidation instead.

I'd also suggest that anyone doing business with KAL to contact local trading standards because although they're normally more consumer facing, a company that has a history of going under and reforming could lead to sanctions against Kellie Armstrong to prevent her from acting as a director of a company in the future. It may also be worthwhile looking into whether a complaint can be made to the Department of Trade and Industry, which has director strike-off powers.

T. Nielsen Hayden:
is there any independent confirmation that this liquidation actually took place, or did you just hear about it from Armstrong and her husband?

I believe that pre-packs are only available to companies so the creditors can check whether a liquidation is happening by looking the company up on Companies House as any liquidation dealings would have to be registered there. There's a free websearch page here:

http://wck2.companieshouse.gov.uk/7f6db328887cb902703c219ec5afc32b/wcframe?name=accessCompanyInfo

Although you'll have to pay a nominal sum of £1 or so to download any documents.

MM
 

T. Nielsen Hayden

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Thank you. That wrinkle's new to me.

I can accept the validity of those generous bankruptcy terms. What bothers me is allowing the owner's spouse to be the one who buys the business.
 
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Momento Mori

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T. Nielsen Hayden:
What bothers me is allowing the owner's spouse to be the one who buys the business.

:nods:

Yes. Even worse, you can have run a business into the ground, go for a pre-pack, set up a new company and then buy all your old assets back at a knock down price. It's a licence to keep hitting and running.

MM
 

robjvargas

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In theory, the liquidator of the company is supposed to look after the creditors' interests and my suggestion (although I'm not an insolency practitioner) is that anyone who decides to continue to do business with KAL should make sure they're given the liquidator's details and put in a claim for the next time it decides to pre-pack.

:roll:

Sorry, I don't mean to derail a serious discussion, but that typo fits both ways, and deserves a call-out.
 

Momento Mori

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Ha!

Oh dear. Paging Dr Freud, could Dr Freud come to the All Craft Media thread, where Momento Mori is close to a personal break through ...

:D

MM
 

evilrooster

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Here's my question for KAL's creditors: is there any independent confirmation that this liquidation actually took place, or did you just hear about it from Armstrong and her husband? It's worth checking. Consider chipping in on an hour or two of legal advice, and find out what your options are. Kellie Armstrong's many outstanding debts may still be collectible.

I linked to independent confirmation on the original Making Light post. The source, Companies in the UK, looks like it's taking a feed of some sort from Companies House and reselling details, but it does mention that KAL Media was "liquidated as of 29 February 2012".
 

SaucyPaladin

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I just want to note that the owner in question is Kerrie Allman, not Kellie Armstrong as some have mentioned upthread.
 

SaucyPaladin

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If you are owed the return of a sample by either All Craft Media or by KAL Media, please look here. More information about these samples is available here.
 

evilrooster

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The titles from All Craft Media have been sold to two different owners. Knit, Inside Crochet and Handmade Living have been purchased by Tailor Made Publishing. (If we have a discussion of Tailor Made titles, I would suggest starting a new thread.)

ACM's sewing titles, Sew Hip (renamed Simply Sewing), Modern Quilting and Handmade Fashion, (also, apparently, Handmade Weddings and Simply Beautiful) appear to now be owned by Craft Magazine Shop.

Investigations here and here indicate that the domain for Craft Magazine Shop was purchased by ACM, and that phones at CMS are being answered by Kerrie Allman's family members. It's probably safe to assume that CMS will follow ACM's business practices.
 
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JulesJones

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I am neither a lawyer nor an accountant, but I have some experience at the day job in tracing administration/liquidation histories -- and yes, we do see plenty of examples of families playing pass the parcel with a limited company in order to evade their creditors. The phoenix companies pass the assets minus the debts from spouse to spouse to child to sibling to aunt/uncle, and in the most egregious cases, there'll be several members of the family who have already been barred from holding directorships.

Expect to see a few more rounds of it in this case, although it's certainly worth pursuing it with Trading Standards, as eventually they'll run out of directors.

I would add one correction to Momento Mori's most excellent post -- it also affects employees, because one motivation for this sort of shell game is to dump employees without paying back wages or redundancy payments. However, when it's being done specifically for that reason, it's typically small businesses employing only a handful of people, so it doesn't normally get much attention outside their local press. And as demonstrated here, that includes freelancers/contractors as well as direct employees.
 

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