Levin’s hope for rescue likely over after Art Van Furniture bankruptcy liquidation
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A federal judge has approved a petition to liquidate Art Van Furniture, the Michigan-based chain that in 2017 acquired the Levin’s and Wolf’s furniture stores scattered across Pennsylvania and Ohio.
The order handed down in U.S. Bankruptcy Court in Delaware is effective Tuesday. It apparently quashes any opportunity for Robert Levin, the former owner of the Levin’s chain, to acquire and extricate the family-owned business he sold to Art Van three years ago.
Levin, whose grandfather founded the company in Mt. Pleasant in 1920, began crafting an agreement to repurchase the chain after learning that Art Van Furniture was experiencing financial trouble. He inked a deal to buy back 44 furniture stores in Pennsylvania and Ohio two days before Art Van, on March 5, filed for reorganization under Chapter 11 bankruptcy protection.
The Levin deal would have saved the jobs of about 1,000 workers across the region.
In addition to throwing a damper on Levin’s plan, the new order also could affect the standing of customers who filed complaints with the Pennsylvania Attorney General’s Office, seeking to recover thousands of dollars in deposits and payments made on furniture that was never delivered. A spokesman for Attorney General Josh Shapiro said the office had received 58 complaints against Wolf Furniture and 282 against Levin Furniture as of Tuesday.
In filings seeking to convert to a liquidation plan, attorneys for Art Van said their reorganization fell victim to stay-at-home orders issued last month that forced the closure of retail outlets as fears of the coronavirus spread.
Original plans called for closing most of the stores, but keeping the 44 Levin’s and Wolf’s stores operating, pending the closing of the sale agreement with Levin.
But even before the stay-at-home orders were issued, Art Van said fears of the virus were evident in sales figures that “dissipated to almost nothing” by mid-March. In their filing, lawyers for the company said deposits from inventory sales that were “in excess of $23 million” during store closing sales from March 5-8 plummeted to just $8 million by the week ending March 15.
Those same factors, they said, led to the collapse of a sales agreement they inked with Robert Levin just prior to filing Chapter 11.
Levin could not immediately be reached for comment.