Faced with annual operating losses, declining reserves and a hefty arbitration award, the Natural Products Association is seeking protection from creditors. NPA filed a petition Aug. 19 in the U.S. Bankruptcy Court in Wilmington, Delaware.

"The Chapter 11 filing will allow the Debtor the breathing spell necessary to redirect its efforts, including the time of its senior staff, to growing its core business of advocating for the interests of the natural products industry and attracting new members," states a declaration by CEO Daniel Fabricant that was filed with the case.

NPA is holding its annual lobbying event on Capitol Hill, Natural Products Day, on Sept. 10, followed by a two-day conference, The Big Natural.

The largest unsecured claim listed in the petition is a preliminary arbitration award of about $780,000 in compensatory damages to former Chief Financial Officer Brent Weickert. He filed suit in 2015, alleging that he was terminated for exposing misconduct, which NPA disputes. The bankruptcy declaration notes that Weickert is also seeking punitive damages and attorneys' fees, but the arbitrator has not entered a ruling on these additional claims.

Tax documents show total revenue of $2.6 million in 2017, the latest information available. Fabricant's take-home pay was $347,000.

In the bankruptcy filing, NPA reported having six full-time employees as well as outside contractors. Reserves were boosted in 2009 by the sale of NPA's trade show and in 2016 by selling property in Washington, D.C., that housed NPA's headquarters.

NPA says it has more than 1,000 members, including retailers, suppliers, manufacturers, distributors and other entities in the natural products industry.

MORE CEO DATELINE

• Business Roundtable shifts focus from shareholder primacy
• AMA withdraws from anti-'Medicare For All' group
• Rival contactors' groups embroiled in copyright lawsuit