Shares in photography icon Kodak fell to a record low after reports the company is preparing for a Chapter 11 filing sometime "in the coming weeks."

A report in Wednesday's Wall Street Journal said Kodak's future is looking less promising by the day, leading investors to get rid of Eastman Kodak Co. stock by the droves. It said the company was readying to file unless it sold 1,100 digital-imaging patents that it has been trying to get rid of for months.

The patents were believed to be worth between US$2 billion and US$3 billion, but no buyers have come forward since they were put on the market in July. It said in November that it could run out of money within a year if they were not sold.

The sale is further complicated by an ongoing legal dispute with Apple and Research in Motion, which Kodak is accusing of infringing on its patents. Much of today's digital photography technology relies on Kodak-developed technology from its 100-year history.

The U.S. International Trade Commission judge presiding over the dispute is planning to decide the case by Sept. 21. If Kodak wins, it could be eligible to receive at least US$1 billion in fees.

Kodak reported a third-quarter loss of $222 million, its ninth loss out of the last 12 quarters, and said its cash reserves have dwindled by 10 per cent over three months. On Wednesday, the value of its shares dropped by 18 cents, or 28.2 per cent, closing at 47 cents. They continued falling in overnight trading.

Their previous low had been Sept. 30, when they hit 54 cents upon work Kodak had hired a law firm specializing in advice on bankruptcy and restructuring.

Robert Burley, a Ryerson University Image Arts professor who has documented the decline of Kodak in a photography exhibit, says the company's impeding bankruptcy marks the end of an era.

"Kodak is an American icon that has played a role in pretty much everyone's lives over the last 100 years," he said in a telephone interview with "People have trusted Kodak with their most treasured possessions, their memories, photographs of their children, their vacation."

In just over a decade leading up to 2011, the company's value dropped by 95 per cent as it was stripped of relevance by the move to digital photography and faced stiffer competition internationally.

Burley says it's ironic that Kodak was an innovator in digital photography starting in the late 1970s, yet it was the same market that spelled its doom.

"They were not able to take advantage of that innovation that happened within their own building," he said.

Burley says Kodak was too devoted to film, its big money maker, and worried that digital photography would siphon off revenues.

"They were unable to let go of their bread-and-butter . . . and that is what has really killed them. They were too big, too clumsy to move on."

Analysts wonder whether Kodak will be able to pull out of its slump.

"Everybody has a sinking feeling," Ulysses Yannas, a Buckman, Buckman & Reid broker in New York, told the Associated Press.

However, its new core business of photo printers is on the verge of turning a profit, rising by 13 per cent in the third quarter. The company said it expected it to become profitable in the following quarter, which it reports on Jan. 26.

The company's plan to sell key assets such as the patent set came as its shares dropped by another 80 per cent of their value in 2011, after starting the year near $3.

"It feels like water torture," said Mark Zupan, dean of the University of Rochester's Simon Graduate School of Business Administration. "The game hinges on that (patent) sale, principally. And, at this point, they just have to create the insurance if they've got to go the other route. But the prospect of bankruptcy makes the sale more complicated too."

The company was warned earlier this week that its shares risk being dropped from the New York Stock Exchange if they stay below $1 for six more months.

With files from's Josh Visser and the Associated Press