Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

RadioShack Files For Chapter 11 Bankruptcy Again

Author: Joel R. Glucksman

Date: May 11, 2017

Key Contacts

Back

General Wireless Operations Inc., best known as wireless and electronic store chain RadioShack, filed for Chapter 11 bankruptcy for the second time on March 8, 2017. The Fort Worth, a Texas-based company first filed for protection in 2015, which led to the reorganization of business and the closing of nearly 2,400 of its stores, according to USA Today.

As of now, the company has plans to close roughly 200 more of its stores and reevaluate the options for its other 1,300 locations. Additionally, 360 of the stores RadioShack shares with Sprint – a business move they made after the first bankruptcy – will close. Overall, this will impact about 1,850 of the company’s employees.

Bankruptcy Law articles

In a statement, Dene Rogers, RadioShack’s president and chief executive officer said that the company has made progress since filing for bankruptcy in 2015, and that doesn’t go unnoticed.

“Since emerging from bankruptcy two years ago as a privately owned company, our team has made progress in stabilizing operations and achieving profitability in the retail business, while our partner Sprint managed the mobility business,” he said. “In 2016, we reduced operating expenses by 23%, while at the same time saw gross profit dollars increase 8%. Over the same time, we integrated FedEx pick-up/drop-off into 140 RadioShack locations, delivered to customers over 700,000 Hulu login pins and sold more than a million RadioShack private brand headphones and speakers delivering high quality, value- based audio products to consumers across the country.”

While RadioShack has seen improvement, they’ve witnessed downfalls as well. That’s why Rogers believes filing for Chapter 11 protection again is the best way to move forward.

“However, for a number of reasons, most notably the surprisingly poor performance of mobility sales, especially over recent months, we have concluded that the Chapter 11 process represents the best path forward for the Company,” he said. “We will continue to work with our advisors and stakeholders to preserve as many jobs as possible while maximizing value for our creditors.”

A downward spiral for electronics stores

RadioShack isn’t the only company feeling the whiplash of the digital age. Circuit City led the path in 2009 when it failed to find a buyer, according to Fortune. More recently, electronics and appliances retailer hhgregg filed for Chapter 11 bankruptcy on March 7, 2017.

What are the issues these physical retailers can’t seem to tackle? Keeping up with the ever-changing landscape in technology and matching the inventory that can be found online, according to The New York Times. For many consumers, the ability to sit back, relax and order electronics from the comfort of the couch sounds more appealing than driving to the mall and walking through a crowd of people to make a purchase. It’s as simple as that. Any retailer that wants to survive the change in shopping trends needs to take advantage of online sales and may want to consider developing an e-commerce business plan.

Are you a ?  Have you been sued by a bankrupt?  If you have any questions about your rights, please contact me, , at 201-806-3364.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Corporate Transactions: Best Practices for Successful Deals post image

Corporate Transactions: Best Practices for Successful Deals

Corporate transactions can have significant implications for a corporation and its stakeholders. For deals to be successful, companies must act strategically to maximize value and minimize risk. It is also important to fully understand the legal and financial ramifications of corporate transactions, both in the near and long term. Understanding Corporate Transactions The term “corporate […]

Author: Dan Brecher

Link to post with title - "Corporate Transactions: Best Practices for Successful Deals"
How to Conduct a Fair and Legal Employee Termination in 2025 post image

How to Conduct a Fair and Legal Employee Termination in 2025

Ongoing economic uncertainty is forcing many companies to make tough decisions, which includes lowering staff levels. The legal landscape on both the state and federal level also continues to evolve, especially with significant changes to the priorities of the Equal Employment Opportunity Commission (“EEOC”) under the Trump Administration. Terminating an employee is one of the […]

Author: Angela A. Turiano

Link to post with title - "How to Conduct a Fair and Legal Employee Termination in 2025"
Admin Dissolution for Annual Report: What You Need to Know post image

Admin Dissolution for Annual Report: What You Need to Know

While filing annual reports may seem like a nuisance, failing to do so can have significant ramifications. These include fines, reputational harm, and interruption of your business operations. In basic terms, “admin dissolution for annual report” means that a company is dissolved by the government. This happens because it failed to submit its annual report […]

Author: Dan Brecher

Link to post with title - "Admin Dissolution for Annual Report: What You Need to Know"
What Is Antitrust Litigation Law? post image

What Is Antitrust Litigation Law?

Antitrust laws are designed to ensure that businesses compete fairly. There are three federal antitrust laws that businesses must navigate. These include the Sherman Act, the Federal Trade Commission Act, and the Clayton Act. States also have their own antitrust regimes. These may vary from federal regulations. Understanding antitrust litigation helps businesses navigate these complex […]

Author: Robert E. Levy

Link to post with title - "What Is Antitrust Litigation Law?"
Dissolving Your Business: Essential Legal Steps to Protect Your Interests post image

Dissolving Your Business: Essential Legal Steps to Protect Your Interests

If you’re considering closing your business, it’s crucial to understand that simply shutting your doors does not end your legal obligations. Unless you formally dissolve your business, it continues to exist in the eyes of the law—leaving you exposed to ongoing liabilities such as taxes, compliance violations, and potential lawsuits. Dissolving a business can seem […]

Author: Christopher D. Warren

Link to post with title - "Dissolving Your Business: Essential Legal Steps to Protect Your Interests"
The Role of Corporate Restructuring in Mergers & Acquisitions post image

The Role of Corporate Restructuring in Mergers & Acquisitions

Contrary to what many people think, corporate restructuring isn’t all doom and gloom. Revamping a company’s organizational structure, corporate hierarchy, or operations procedures can help keep your business competitive. This is particularly true during challenging times. Corporate restructuring plays a critical role in modern business strategy. It helps companies adapt quickly to market changes. Following […]

Author: Dan Brecher

Link to post with title - "The Role of Corporate Restructuring in Mergers & Acquisitions"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form. By providing a telephone number and submitting this form you are consenting to be contacted by SMS text message. Message & data rates may apply. You can reply STOP to opt-out of further messaging.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!