Two years after Art Van Furniture went bankrupt and started closing all its stores, the bankruptcy case's trustee is now attempting to go after the family of the late Art Van Elslander for tens of millions of dollars in proceeds from the retailer's 2017 leveraged-buyout sale to a private-equity company, Detroit Free Press reported. The lawsuit, filed this month in federal bankruptcy court in Delaware, focuses on the flurry of sale-leaseback transactions that were part of the deal and involved nearly 40 Art Van Furniture stores and related properties that the retailer had owned outright. Those transactions financed 70% of the Van Elslanders' $621 million deal in March 2017 with Boston-based Thomas H. Lee Partners. The sale-leasebacks saddled Art Van Furniture with new rent expenses — on top of a debt load from the deal — that, according to the lawsuit, immediately doomed the company and would prove unsustainable. Company founder Art Van Elslander was still alive when the sale happened. He died the following year at age 87. Proceeds from the real estate transactions went to do the deal — not support the furniture company's future. The Archie A. Van Elslander Trust received more than $529 million from the sale, and entities controlled by the patriarch's children, including Gary Van Elslander and David Van Elslander, received more than $75 million, according to the lawsuit. The lawsuit seeks to recover more than $105 million in what it calls "fraudulent transfers" that included the sale-leaseback transactions, as well as $8 million in transfers to Gary Van Elslander and $2.5 million to David Van Elslander, among other transfers.
