1-877-581-3396Submitted by the Bond & Botes Law Offices - Friday, May 2, 2014
The women’s retail clothing store, Coldwater Creek, filed for Chapter 11 Bankruptcy Protection on April 11, 2014 in Wilmington, Delaware after efforts to sell the company failed. The clothier has been in business for 30 years, however, they have not posted an annual profit since 2007 and the company’s sales plunged 17 percent last year. They follow in the wake of several other mall storefront businesses who have filed bankruptcy from what seems to be partly due to a decrease in mall traffic.
Coldwater Creek began as a catalog business in 1984. It was started by Dennis Pence, a former Sony executive. It began by selling women’s accessories and gifts. It began opening stores in the early ‘90’s and as of November 2, 2013 reportedly had 379 locations including 31 factory stores along with 7 day spas.
The company’s filing lists about $279 million in assets but close to $361 million in debt. The company’s two largest unsecured creditors are Comenity Bank and Groupon. Holders of their common stock should not expect to recover any of their investment. It is reported by several news outlets that the plan is to close all of its retail stores by early summer putting nearly 6000 employees out of work nationwide. The company further plans to begin liquidating its inventory in May, just before Mother’s day, one of their peak sales weekends.
The bid deadline to auction the business was earlier this week and an auction is scheduled for May 1, 2014, with a hearing to approve the results of the auction to follow on May 6. The U.S. Bankruptcy court heard arguments earlier this week authorizing the proposed auction rules. One of the things still in question is the selling of certain assets to include customer mailing addresses and email information. The company has always had a privacy policy which states they will “never sell or trade customer email addresses.”
The swaying economy can affect anyone, big companies to minimum wage workers, to include the unfortunate employees of Coldwater Creek.
If you are having any financial difficulty and would like to speak with an attorney who has experience in this area of law, please call our office nearest you and schedule a free initial consultation to privately discuss your financial difficulties with one of our licensed attorneys.
