Jersey Shore Resort Owner Files For Bankruptcy Amid Lawsuits

ATLANTIC CITY, NJ — The owner of three luxury resorts at the Jersey Shore has filed for Chapter 11 bankruptcy while the company fights several lawsuits, according to documents filed in federal court.

Flagship Resort Development Corp., owner of the Flagship and Atlantic Palace resorts in Atlantic City and La Sammana in Brigantine, filed for bankruptcy on May 10, 2025.

The company has between $50 million and $100 million in assets, and the same amount in liabilities owed to more than 100 creditors, federal documents show.

The three resorts operate as timeshare properties. Rising interest rates and the COVID-19 pandemic put pressure on families and caused timeshare interest to drop, which the company cites as reasons for declaring bankruptcy in the documents. Flagship also owes more than $8 million to ownership associations, the documents show.

Additionally, the company is facing ongoing litigation. A lawsuit by 19 plaintiffs alleging deceptive business practices filed in 2018 ended with them being awarded $1.6 million in damages. Another similar suit was filed by 12 plaintiffs in 2023; that suit will be brought to trial this September.

Yet another lawsuit was brought against the corporation - this time, a class action lawsuit on behalf of 10,000 members seeking more than $100 million in damages, documents show.

All of these factors forced the corporation to file for bankruptcy, the company's chief financial officer wrote in the documents.

Two of the company's board members resigned in April and formed AC Boardwalk Investments, LLC. They've offered a $45.5 million "stalking horse bid" for Flagship's assets and debts, which means they will make the initial bid to set a base price and encourage other bidders to join.

The deadline to submit bids is July 14; an auction will follow on July 16. A sale hearing is then set for July 18.