It's over folks.
https://seekingalpha-com.cdn.ampproject.org/v/s/seekingalpha.com/amp/article/4269508-sears-filed-new-budget-investors-employees-disappointed?amp_js_v=a2&_gsa=1&usqp=mq331AQA#referrer=https%3A%2F%2Fwww.google.com&_tf=From%20%251%24s&share=https%3A%2F%2Fseekingalpha.com%2Farticle%2F4269508-sears-filed-new-budget-investors-employees-disappointed
Insane amount of cancellations on almost all stores this morning on the sales flash, this is place is collapsing on itself pretty much
@ipxe
The assets he hasn’t paid for relates only to the cash on hand dispute likely the judge is just gonna tell one side or the other to just drop it already. Eddie is only being a stickler about it because if he wins the argument he gets to keep both the $57 million cash and the $44 million in credit receipts. Likely settlement is one side will end up keeping half the other the other half. Worst case he has t pony up $13 million.
The $2 billion is an entirely different matter, the unsecured creditors will have a years long uphill battle in court if they hope to recovery any of that. Eddie was very good at manipulating that stuff the chances anything grossly illegal will be found are slim. Many of the spinoffs occurred years ago, were approved by independent boards. The judge has already declared that it will have to be fought outside of bankruptcy. Most of it is baseless anyway they claimed stuff like meaningless mothballed trademarks for house brands sears no longer uses were worth a fortune. Eddie had repeatedly tried to unload some of the stuff before with no takers. Given the complexity of the matter even if sears lasted 10 more years that case or parts of it will still be kicking around court.
@1ypm He has still not fully paid for all the assets. That is certainly not minor.
@1ypm you missed the latest filing for the extension of the exclusive period. the debtors are claiming $2 BILLION in causes of action
The tieup is relatively minor and if it begins to effect anything he will cut the check.
Basically Eddie kept $57 million in day to day cash to prevent seamless operation. Old Sears claims he owes them this.
In return due to credit card processing times $44 million in credit receipts are in a limbo.
Eddie claims they short changed him $165 million In Inventory so he’s suing to keep the money from the cash on hand.
Unfortunately they aren’t really going to be able to come after him for the legal fees. The purchase agreement set aside cash to pay these, it may not be enough but the lawyers will be getting that pot. It was enough before this kept getting dragged out.
Other creditors can try to sue him for other stuff but the burden of proof is going to be hard the legal case expensive, all except the largest creditors probably won’t bother. Most of the largest ones were paid.
Raining wet t–ds for most all of the survivors. Feeling so sad for you all still in the c-apzone. Just remember to update the Rez, and apply early and often. Take what you can get and try to be okay with it. God Bless!
Why would merchandise flow into a store? Nobody shops there? Seems bizarre....
@wzq Yes, this does affect the new company because as the article points out Eddie has not fully paid for the assets of the new company. I spoke to a bankruptcy attorney familiar with the Sears/Transform bankruptcy and sale and he said that technically we are in limbo until Eddie fully pays for the assets. As long as Eddie and old Sears tie this up in court by suing each other it will not be resolved. The court could potentially freeze all assets for both old Sears and Transform which could stop all merchandise flows into the store since the cash and credit lines would be frozen.
There's over $100M of legal fees that Old Sears racked up under Eddie's watch that have not been paid that are priority. You bet your a-- they're coming directly after ESL, Transform, Eddie, and the rest for any deficiencies. They're lawyers. These kinds of shenanigans are completely unprecedented in the history of bankruptcy. There's never been anything like it. As the article points out, it's to the point that it's sowed distrust by vendors towards the entire retail industry, because they're afraid retailers might start acting like Eddie, which has never happened before. That's how much of a scumbag Eddie is, his taint is so bad he that others earn distrust just for being in the same industry. Without any exagerration, he's the biggest sleazebag in the history of retail. There's multiple pending litigations against Eddie and ESL already, and this will just add mountains to the fire.
Lawyers need money to sue. There isn’t much left and the claims by those that didn’t get paid are less than the legal bills they’re already racking up. I’m guessing some bigger firms may still proceed but he’s probably going to get away with minimal punishment.
The article was about old company not new company. New company has lots of money.
That article doesn't sound like over at all. It sounds like the barest beginning of a new legal sh--storm for Eddie. He's going to get sued by every lawyer under the sun.