Whirlpool has demanded that Sears send back products the appliance-maker shipped in the weeks before the retailer filed for bankruptcy protection, the Chicago Tribune reported. Benton Harbor, Mich.-based Whirlpool, which stopped selling its branded products at Sears last year but makes appliances under Sears’ Kenmore brand, asked the department store chain to return all merchandise it received in the 45 days before its chapter 11 bankruptcy filing on Oct. 15. In a letter filed in court last week, Whirlpool’s attorney demanded that Sears “refrain from selling, disposing, or using … for any purpose whatsoever” the merchandise it received from the appliance-maker during that time without permission from the U.S. Bankruptcy Court. Sears listed Whirlpool as one of its largest unsecured creditors in its bankruptcy filing, saying it owed the appliance maker $23.4 million. But Whirlpool isn’t the only company asking the retailer to send goods back. Twentieth Century Fox told Sears it wanted $207,260.15 worth of merchandise returned, saying it believed Kmart received the products while insolvent, according to a letter filed with the court. The merchandise should not be sold without Fox’s written consent or a court order, an attorney for Fox wrote. Invicta Watch Co., Body Flex Sports, Reynolds Consumer Products and East Penn Manufacturing sent similar letters. Read more.
One of the worst outcomes for a business owner is having a major customer file for bankruptcy and leave behind a large unpaid account receivable. ABI's Business Creditor’s Guide to Distressed Vendors, Debt Collection and Bankruptcy provides an insider’s look into the options available to help screen a business’s customers, plan for worst-case scenarios, and, if the situation does arrive, efficiently handle the fallout.
