From the facts reported, I don't see how they could come away with worthless equity and worthless debt. Whatever the tax implications, their liability should be

From the facts reported, I don't see how they could come away with worthless equity and worthless debt. Whatever the tax implications, their liability should be limited--they could win the thing at the bankruptcy auction for $1, and then turn off all the lights and go home, only $1 poorer. So if someone wants to inject new money and keep running the business, then they should at least get some hostage value. Maybe Birchbox has enough trade creditors with claims senior to the investors' debt to somehow wipe them out? That sounds pretty weird, though. If only all financial journalists were trained as securities lawyers...