Texas Bankruptcy Watch: Cerebrum Health Centers

: Chris Lee Law Firm

  Filed under: News

A Farmers Branch, Texas-based chiropractic center working on groundbreaking brain trauma treatments has declared bankruptcy and closed its doors. The company, Cerebrum Health Centers was once a darling of numerous Texas investors and Governor Rick Perry alike. The company, formally known as Carrick Brain Centers, was even given research funding to the tune of $2 million, courtesy of Texas taxpayers.

Cerebrum Health Centers

Cerebrum’s primary claim to fame was a brain trauma treatment that involved placing a patient in a gyroscope pod and was seen as an extremely promising treatment by several investors including the president of Pizza Hut and Pro Football and Baseball athletes. The device was used for an array of PTSD and head trauma conditions such as concussions, chronic headaches, vision problems, and dizziness. Still, various scientists and state regulators felt that there was no scientific merit to the groundbreaking treatment, nor any solid scientific proof that the therapy actually worked.

Filing Bankruptcy

The Northern Texas clinic closed up shop on March 30th, 2018 and promptly filed for bankruptcy protection in US Bankruptcy Courts in Texas, claiming more than $3.6 million in debt. Nearly $200,000 of that debt is still owed directly to the state of Texas. Ultimately, the company blamed it’s insolvency to not being able to attract enough patients to pay down its enormous debts.

Caulk this up to a failed study

A 5-month investigation raised the question about the scientific basis of the company’s treatment. At the conclusion of the investigation in 2015, it was decided that the treatment didn’t work and the company was ordered to refund the state contract money. After establishing a payment plan to return the taxpayer money, the company declared bankruptcy in Texas, locked its doors, and stopped paying the award money back. State Representative Chris Turner spoke about the bankruptcy filing, stating, that he hopes that state legislatures will be more thorough in vetting companies that they fund in the future.

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