Below is a list of major retailer bankruptcies for 2008 and their impact on gift card holders. As you will find, almost all the retailers listed continued to honor gift cards during bankruptcy, with the exception of Bombay Company and The Sharper Image (which did honor gift cards but with restrictions). We hope the trend of retailers honoring gift cards during bankruptcy continues in 2009.
A note to our readers: If you are still holding on to gift cards from the retailers below and they are still accepting gift cards, NOW is the time to use the gift card or lose it. The next update will be in January unless there is a major announcement in December.
Circuit City – Filed for Chapter 11 bankruptcy in November, 2008. The company is still accepting gift cards and issuing new ones. Our advice is to use your Circuit City gift card NOW and not buy a new Circuit City gift card while they are still in bankruptcy.
Linens ‘N Things – Initially filed for Chapter 11 bankruptcy but later followed up with a total liquidation in October, 2008. The company is still honoring gift cards during the liquidation.
Steve and Barry’s – Initially filed for Chapter 11 in July, 2008 but later followed up with a Chapter 7 in November, 2008. They are closing all stores. The company is still honoring gift cards during the liquidation.
Tweeter – The electronics retailer filed for chapter 7 bankruptcy on Nov. 5, 2008. The company initially wanted to honor gift cards for 5 days (yes, 5 days to redeem gift cards) but after pressure from a number of state Attorney Generals, the company relented. They are now honoring gift cards until they complete the liquidation.
Value City Department Store – The company filed for bankruptcy in October 2008 and plans to close all remaining stores. Value City continues to honor gift cards during the liquidation.
Boscov’s – Filed for Chapter 11 bankruptcy in August 2008 and continues to honor gift cards. The remaining stores were recently sold to a group led by a Boscov family member and they plan to stay in business.
The Sharper Image – Liquidated the entire business and closed all stores. The company initially refused to honor gift cards but caved after pressure from consumers. However, gift card holders were able to redeem the full value of their gift cards only after purchasing goods worth twice the value of the card.
Bombay Company – Went Bankrupt in late 2007 and closed all stores. The company did not allow gift card holders to redeem gift cards but were instructed to file a claim with the bankruptcy court. Gift Card holders were offered 25 cents on the dollar in summer of 2008.