Blockbuster is set to file Chapter 11 in mid-September, according to THE HOLLYWOOD REPORTER. The move will allow the video rental company to get breathing room from its almost $1 billion debt and break free from leases on hundreds of stores. The pre-packaged bankruptcy will see the company's creditors holding a big share of equity in the firm. Last week, Blockbuster CEO Jim Keyes did the tour of Hollywood studios to work out details of the plan.