Bankruptcies often take years to unwind and hhgregg’s swan dive is no different.
One year after shutting its doors and website, the chain’s former officers and directors may be in for a wild legal ride.
According to the Indianapolis Business Journal, the company’s unsecured creditors have hired a law firm to pursue what could be a sizeable claim against the team that rode the retailer down.
At issue was the management of hhgregg prior to its 2017 bankruptcy. On March 2 it announced plans to close 88 of its 220 stores to improve liquidity and return to profitability, and five days later filed for Chapter 11 protection.
Former president/CEO Robert Riesbeck said it was private-label credit card provider Synchrony Financial and secured lender Great American Capital that essentially pulled the plug by imposing unendurable new terms.
Nonetheless, the law firm is licking its chops over a possible payout from the management team’s liability insurance of as much as $20 million or more.
But if that doesn’t work out, there are still another 150-plus post-bankruptcy lawsuits pending. As the great sage Yogi Berra said, it ain’t over ’til it’s over.