Sharper Image, Ltd. just got the go-ahead to retrieve a 6 million dollar severance bonus from former CEO Richard Thalheimer in order to pay off its debts. 

The company closed the doors of its retail locations for good in August of 2008.  Still, post-bankruptcy Sharper Image hasn’t completely fallen off the map, as they maintain their company’s website and sell products (ranging from TV remotes to back massagers) through Best Buy and Bed, Bath and Beyond.  The court found through the Bankruptcy Code that payments made within two years of a company’s demise could be pursued to pay off creditors.

The legal action must sting for Thalheimer, as he founded Sharper Image in the late 70s.  He also discovered and was also instrumental in selling Sharper Image’s most profitable product, the Ionic Breeze Air Purifier.  3.2 million Americans bought the air purifier, and it was considered an unparalleled success for the luxury electronics seller.  It differed from other purifiers, as it wasn’t fan-based and was completely noiseless.  But due to its electronic components, this meant that it emitted unhealthy levels of ozone. 

When Consumer Reports caught wind of this information, they broadcast it near and far, and Sharper Image countered them with an ill-advised libel suit that the ionizers were unfairly tested—their claim was unfounded, and accumulated $525,000 in legal fees for the troubled company.  That sum was particularly nasty when doubled with the $600 million settlement, which offered a $20 merchandise refund to each of the 3.2 million customers who had bought the toxic air purifiers.

So while the bankruptcy court has ruled to secure $6 million from the former founder, they will first have to trudge through the appeal to secure those funds.  The $6 million sum also happens to be the total price of Sharper Image’s bankruptcy proceedings, and paying it off would finally free the company of its liabilities.

 For Sharper Image, a series of bad investment decisions led to massive debt and legal fees. However, even regular consumers like you can make all the right financial choices but still fall into the credit card trap, or have extenuating circumstances like health issues that push them into debt. 

You can overcome bad financial luck with a bankruptcy that will protect you from your creditors.  Call Legal Helpers for a free initial consultation to find out more at 1-800-260-1402.

After closing 570 locations in 2007, filing for Chapter 11 bankruptcy in 2008, and closing an additional 450 locations in 2009, Movie Gallery, Inc. is finally shutting its doors for good.  The movie rental chain initially filed their bankruptcy in February of this year, and can now expect to close more than have of its 2,415 locations, starting with their Hollywood Video locations.

This is good news for Blockbuster, Inc.’s ears, as they now can claim a relative monopoly on the video rental chain market.  Investors turned heads at the news too—Blockbuster’s stock jumped 18 percent to trade at 44 cents a share. 

However, now that movie rental has taken on the instant-access of the Internet, there are dozens of alternatives to renting at a store—Netflix, iTunes, Hulu, Comcast on Demand, and many more.  Industry giants like Blockbuster have tried to keep up with this “instant” demand and have had to close 900 stores in the U.S., and “opening” 10,000 automated kiosks in 2010.  Still, they show no signs of returning to their grand old glory days—despite changing its tactics, Blockbuster has been dealing with severe financial losses for months.

If Blockbuster does end up filing for bankruptcy, they will probably liquidate their stores first, instead of the efficient automated kiosk rental stations. 

If you’re accumulating late fees more serious than an overdue DVD, you might want to consider bankruptcy as a solution.  You can consolidate the debt you have without tripling it in a creditor lawsuit.  Call Legal Helpers for relief and protection toll-free at 1-800-260-1402.  There’s no charge for the first consultation. Call now.

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