Reply To: Native Instruments Insolvency and Updates

[LinkedMusicians]

It just struck me. I need to update the blog post. I posted about the general manager of Plugin Alliance posting that the preliminary insolvency doesn’t currently apply to Plugin Alliance, but to be very candid, his statement was a bit misleading. He was communicating that it’s business as usual — he literally stated that — but the reality is, Plugin Alliance could still be forced to file for bankruptcy protection independently in their own countries of operation—such as under Chapter 11 in the United States—to manage their own liabilities. Every Native Instruments subsidiary is governed by the insolvency/bankruptcy laws of the country where it is incorporated. That actually could be a negative for customers, employees, and supply chain partners, not a positive. His spin was clearly to make customers and new customers feel safe during this time, but he was leading people to a sense of security that was less than accurate. He wasn’t sharing a full picture, and deliberately left out things to make it appear that Plugin Alliance could be safe from insolvency/bankruptcy proceedings. I don’t think that was the right thing to do.

He was only focused on making customers feel that things were normal, “business as usual.” He did caveat that phrase with “for now,” but I found it to be downplaying and leaving out very basic facts he knew that aren’t so favorable and instead playing things off as a positive. I seriously doubt that his statement was ran past a competent and ethical attorney before posting.

I understand very well the need to comfort customers and partners in this time, however, I don’t think that his statement was appropriate, as it would clearly lead most customers into a false sense of security that Plugin Alliance is going to avoid impacts from the insolvency. Plugin Alliance is a part of Native Instruments, and if Native Instruments is in preliminary insolvency with debt substantially larger than they can afford to pay, every holding of NI is going to be in play and anyone communicating with customers should not be trying to create a perception that is not the case.

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