It looks like Kodak may be filing for Chapter 11 bankruptcy. According to a report in the Wall Street Journal, Kodak is currently in talks with lenders for close to $1 billion, money that would keep the company afloat during bankruptcy proceedings.

According to people "familiar with the matter," the company would file for bankruptcy in late January or early February. Even after filing for bankruptcy; however, the company would continue to function while it attempts to find buyers for its collection of 1,200 digital patents through a court-supervised bankruptcy auction. Kodak is reportedly attempting to sell those patents now, in order to avoid the bankruptcy proceedings all together.

If the patents go to auction, the sale would be overseen by a judge, that would follow stick court-defined guidelines and force bidders to make offers that were viewable by other interested parties, and that those parties could then try and best.

Kodak claims to have created the first digital camera in 1975; however waited until its competition released digital options before bringing its own version of the digital camera to market. The move was thought to have been to preserve its print sale business, however, waiting to bring a digital camera to market put the company behind its competition. As print sales have tapered off, Kodak has been unable to compensate for the loss with digital sales.

News off Kodak's potential bankruptcy filing caused its stock to drop to just $.54 today. We should know the ultimate fate of the company in the coming weeks.

[via Wall Street Journal]