Architelos, a consultancy and provider of tools for registry and DNS operators filed for bankruptcy Monday after it lost a court case brought by Afilias.

Architelos lost a patent lawsuit to Afilias last August, reports Domain Incite, with the jury setting “damages at $10 million, finding that Architelos had misappropriated Afilias trade secrets, but the trial judge recently indicated her intention of reducing the award to $2 million.”

However Architelos couldn’t afford even this and had “floated the idea of operating NameSentry on a revenue share with Afilias until its debt was paid.”

Architelos announced in a blog post by its CEO Alexa Raad that it “ceased operations [Monday] and commenced bankruptcy proceeding by filing a petition for Chapter 7 bankruptcy under provisions of Chapter 7 of Title 11 of the United States Bankruptcy Code. Unlike Chapter 11, which provides for reorganization and continuation of operations, Chapter 7 entails immediate cessation of company operations and an orderly liquidation of its assets.”

The company notes that “customers of the NameSentry service are not immediately impacted. NameSentry will continue to operate in the short term, however the decision on the continuation and or timing of the termination of the service will be up to the Trustee.”