In a gross injustice a federal judge, according to ShelfAwareness, upheld in late-May a bankruptcy judge’s ruling that 17.7 million in Borders gift cards worth an estimated $210.5 million cannot be redeemed. Judge Andrew Carter’s rationale was that allowing cardholders to try to recover money from Borders would “upset the liquidation plan that is substantially completed.”
So, let me get this straight . . . the judge ruled in part because it would be inconvenient to help individuals who purchased the gift cards in good faith. Sadly, once again the individual gets screwed. I only wish the judge was a major shareholder in Borders. He might not be so insensitive if he had to shoulder some of the loss millions of customers have.
Now, I haven’t seen the liquidation agreement but you can bet that large publishers and other large vendors will be the first to receive monies from Borders. Those who purchased gift cards, in good faith, won’t even be at the end of the line. They’ll just be totally ignored.
As a small press publisher I went through this same injustice when I published Gauntlet Magazine. I paid all of my bills on time and sent copies of the magazine to numerous distributors as required by contracts I signed with each. However, over the course of a decade, a number of my distributors folded owing what is a tidy sum for a small press and I didn’t receive a penny. Ironically, one of those distributors supplied Borders with copies of the magazine. After I had been told by the distributor that I wouldn’t be getting paid I was appalled to find copies of the magazine still on a local Borders magazine shelf. The bankrupt distributor was going to pay off their debt with my publication for which I would get nothing. I was tempted to walk out of the store with the copies of the magazine that I would never get paid for, but I would have ended up being arrested. And if Judge Carter is any example no judge would have had sympathy for my plight.
Because lawmakers in Washington, despite their talk of helping small businesses, spend most of their time (when not on recess) investigating partisan scandals rather than passing legislation we are ignored whenever a large company folds its tent. And, in the case of Borders individuals get no consideration at all. Just another case of injustice that makes us all cynical.