CaaStle reportedly secures bridge loan to support Chapter 11 process

CaaStle has seemingly found a light at the end of the tunnel. The US fashion rental platform, which has worked with brands like LK Bennett and Derek Lam on branded rental offerings, is believed to have secured a 2.75 million dollar bridge loan to help support an impending Chapter 11 process and despite an ongoing lawsuit.

According to a letter seen by WWD, the board of the company told shareholders that the financing had come from an existing investor affiliated with former director Scott Callon. The loan will be used as a means to buy time to figure out what is next for the company, the media outlet said. The letter cited by the platform reads: “All loan proceeds will be used to fund CaaStle’s critical operations and expenses related to considering strategic transactions and planning for a Chapter 11 process.”

Background: CaaStle founder accused of fraud

Founded in 2011 initially as Gwynnie Bee, CaaStle has faced increasing legal trouble over its relatively short lifespan, with founder and former CEO, Christine Hunsicker, at the forefront of allegations. In March 2025, trouble publicly came to a head when it was revealed that the company had furloughed its employees. Questions began circulating over Caastle’s financing, however, ultimately leading to a third-party investigation.

While CaaStle had reportedly managed to raise over 530 million dollars in venture capital, Hunsicker and other executives at the company are being accused of fraud. A letter sent to investors on March 29, and seen by multiple news outlets, alleged Hunsicker had been providing “misstated financial statements and falsified audi opinions, as well as capitalisation information that understated the number of company shares outstanding”.

Upon the revelation, Hunsicker resigned as CEO and director, with law enforcement then coming in to investigate, the letter confirmed. Hunsicker was further accused of leaving the company with a “severe and immediate liquidity problem”. Audited financials from 2023, reported on by WWD, showed a revenue of just 15.7 million dollars last year, while net losses amounted to 81 million dollars.

EXP files lawsuit over trademark infringement in shuttered subscription service

Hunsicker and CaaStle had already been tackling legal issues, however, when the company was accused of infringing on the trademarks of US clothing brand Express, which had been working with CaaStle on a subscription service before its IP was acquired by EXP Topco and WHP Global. The project, dubbed ‘Express Style Trial’, was initially set to become a multi-brand service after last year Hunsicker told EXP that CaaStle would slowly cease to use the Express name and trademarks.

The two firms set out to negotiate on a licensing agreement, which EXP claims CaaStle had agreed on final terms to in December 2024, WWD reported. The agreement itself, however, was never signed and no payment was made, leaving Express Style Trial to shutter. In the suit, seen by the media outlet, EXP said it was also “investigating potential claims against other CaaStle executives, current and former board members and CaaStle affiliates, including P189 Inc., a company co-founded by Hunsicker [which controls Vince Holding Corp and has a stake in Altuzarra, ed.].”

Responding to the lawsuit, CaaStle told WWD that it “takes this matter seriously, and is committed to addressing the claims and setting the record straight. The settlement agreement with EXP was negotiated in good faith. It is important to note that Ms. Hunsicker did not play any role in negotiations with EXP, and CaaStle clearly communicated its commitment to wind down the site in an orderly fashion to provide the best experience for EXP customers per the terms of the settlement agreement. We deeply regret the impact Christine’s actions has had on CaaStle employees, partners, investors and customers.”

FashionUnited has contacted CaaStle with request to comment on reports of a bridge loan.