Dr. Phil’s Network Merit Street Media Files for Bankruptcy

The TV personality voluntarily made the legal move earlier this week amid an unresolved dispute with the network's Christian parent company, Trinity Broadcast Network.

Dr Phil McGraw has filed for Chapter 11 bankruptcy for his cable TV network, Merit Street Media (MSM), just over a year following its launch under Trinity Broadcast Network (TBN).

The filing was made in the Northern District of Texas on Wednesday, July 2, due to an unresolved legal battle with TBN. A source familiar with the situation told PEOPLE that McGraw made the move to preserve MSM's value as opposed to initiating a shutdown.

"Dr. Phil is deeply committed to the future of the brand and his employees. Despite the situation, he remains focused, energized and — true to form — as supportive and engaged with his team as ever," the insider said.

Describing McGraw as "one of the kindest, most dedicated people," they added, "This is someone who clearly cares and always leads with integrity."

In the complaint, MSM alleges that TBN "abused its position as the controlling shareholder of Merit Street to improperly and unilaterally burden Merit Street with unsustainable debt," leading MSM to "pay or incur obligations to third parties in excess of $100 million."

The document—obtained by PEOPLE—also states that TBN has caused MSM to lose its national distribution "by withholding distribution payments" and this has resulted in MSM having "nowhere to send its broadcast signal and nowhere to air its programming."

The network claims that TBN's choices were "made with full awareness" and with intent to "sabotage and seal the fate of a new but already nationally acclaimed network."