Usually, when a retailer files for Chapter 11 bankruptcy protection, it follows a process designed to protect its relationship with customers. Having covered dozens of retail and consumer bankruptcies over the past 30 years, I’ve seen how these filings can impact shoppers, employees, and operations alike.
Typically, the chain will announce conditions for the filing, such as an “all sales are final” policy or a deadline for redeeming gift certificates.
For example, when Sharper Image filed for Chapter 11 in 2008, I held $200 in gift cards and was able to redeem them during its early going-out-of-business sale. Any cards found later, however, were no longer valid, a reminder that even planned protections can be short-lived…