RAPAPORT… Sears Holdings Corp. must pay suppliers for consignment
goods its customers buy during the bankrupt retailer’s closing-down sales,
according to a court filing last week.
Vendors, including diamond manufacturer Rosy Blue and
jewelry supplier Vijay Gold Designs, had objected to the department store’s previous
closure plans, as they feared Sears would sell off products they had shipped to
it on memo. In an October 25 update, judge Robert Drain instructed Sears to set
up a special account for proceeds of any sales of those goods, and use it to transfer
funds to consignment vendors.
Sears filed for Chapter 11 on October 15, and plans to close
142 stores.
Image: Sears store, Toronto, Canada.
Court Tells Sears to Pay Memo Vendors
The Bottom Line
- Sears Holdings Corp. must pay suppliers for consignment goods sold during its closing sales.
- Vendors like Rosy Blue and Vijay Gold Designs objected to Sears’ initial closure plans over unpaid memo goods.
- Judge Robert Drain mandated Sears to create a special account to transfer proceeds to consignment vendors.
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