Wilmington, Del. – A federal bankruptcy court here OK’d last week’s sale of RadioShack’s intellectual property to hedge fund Standard General over the objections of a rival bidder and amid privacy concerns raised by numerous state attorneys general.
The decision clears the way for the 1,700 RadioShack stores acquired by Standard General in an earlier bankruptcy auction to continue bearing their 94-year-old trademark.
The counter-bidder, a Chinese investment group, claimed RadioShack ended the auction process early by suddenly requesting sealed final bids, and that it would have otherwise topped Standard General’s $26.2 million winning offer, Reuters reported.
A lawyer for RadioShack told the wire service that the bidding had grown tense and that participants might have left had the process continued.
In his decision, Judge Brendan Shannon found that RadioShack was within its rights to alter the bidding procedure as it saw fit, Reuters said.
Meanwhile, the concerns of the attorneys general over the sale of confidential customer information were apparently allayed last week following a nine-hour mediation in which Standard General agreed to severely limit its access to the data. The new owner will be privy to only seven of 170 data fields and to the last two years of customer email, and it will receive names and addresses of 67 million customers rather than the 117 million originally sought, Reuters said.
Still unclear, however, is the fate of some 800 independent RadioShack franchise owners whose contracts were included in the auction and who filed their objection in court.
In a web posting on TWICE.com, Kansas franchisee and buying group founder Frank Beer observed that “the fate of these fine independent businesses continually gets forgotten in the carnage of the [RadioShack] bankruptcy. As a group they would be one of the largest CE chains in the country. And over the past years they have been the one bright spot in the RadioShack world.
“Sad that they are collateral damage in the situation,” he wrote. “They deserved much better and are fighting for their futures.”