PITTSBURGH — At a hearing in Georgia bankruptcy court on Monday, Home Décor Outlets customers were hoping to find out if they would get some of their money back.
The furniture store closed its Pittsburgh location on Liberty Avenue without warning earlier this year, leaving many customers without their furniture or layaway payment refunds.
“That’s not true. We should get our money back,” said Home Decor customer Stacey Dorsey, from Brighton Heights, who first contacted 11 Investigates in June about her problems with the company.
All signs of Home Décor’s former location on Liberty Avenue are gone from the shivering building. This is one of many places closed last year. The company had as many as 17 stores in the southeastern United States, but only two are still open according to the court filing asking Home Decor to go into liquidation.
The biggest creditor asks for liquidation
Today’s hearing was triggered by Home Décor’s biggest creditor, a loan company to which it owes more than $2.5 million.
Crossroads Financial Group has filed a petition in Georgia bankruptcy court asking the judge to convert Home Décor’s Chapter 11 bankruptcy to a Chapter 7 that requires the company to sell its assets to pay creditors.
As Home Décor’s largest secured creditor, Crossroads would be first in line to get paid, while customers like Dorsey would likely be on the phone for reimbursement.
In its court petition, Crossroads Financial insisted it was futile for Home Décor’s bankruptcy to proceed as a Chapter 11 reorganization, saying Home Décor “holds on to a wing and a prayer.” , has failed to come up with a plan to repay its debt and continues to default on its payments.
The petition also revealed that, despite its bankruptcy and uncertain future, Home Décor secured a lucrative pandemic relief payment from the federal government in May. The furniture company received more than $250,000 in employee retention tax credits from the Internal Revenue Service. Photocopies of the checks were attached to the request. Crossroads Financial alleged that Home Décor “wasted” that money.
Despite these disastrous statements, during the hearing, Crossroads Financial lawyer Matt Weiss asked the judge to suspend his decision and continue the hearing at a later date. He told the judge that over the past few days they had made progress with Home Decor in negotiating what he called a “comprehensive settlement.” Weiss said they now believe there is “a realistic prospect of reaching a resolution.”
The judge granted the request to continue the hearing at a later date, but before closing the hearing, he asked if any other creditors wished to be heard by the court.
Customers want their money back
Dorsey was among more than 20 creditors who tuned in to listen to the bankruptcy hearing after receiving a notice in the mail that his rights could be affected.
Dorsey, who has a disability, has receipts showing she paid Home Décor nearly $386 for set aside furniture, but she never received the goods.
“It’s not a lot, but when you have a fixed income it’s a lot,” she said.
“They (other customers) haven’t gotten their money back, so I’m not the only one,” she said. “Some of them even had their furniture paid for in full and didn’t even receive their furniture. Very frustrating. Very frustrating.”
A handful of clients spoke up when the judge asked them if they wanted to be heard.
Dorsey expressed frustration that Home Décor continues to bill customers even though the local store has closed.
Another creditor, who identified herself as Rachel Lassiter, also addressed the court, saying she opposed ‘any motion allowing Home Décor not to pay the money they owe customers’ .
The judge advised any customers with ongoing issues to contact Home Decor attorney Henry Sewell directly.
Since last year, the Pennsylvania attorney general has received 26 complaints about Home Décor’s Pittsburgh location.
The AG’s office told 11 Investigates that it’s premature to say that customers who filed complaints are “out of luck” because the bankruptcy case is pending and he has no yet to be determined how Pennsylvania consumers will be treated in the deal.
Home Décor is still charging customers
11 Inquiries Angie Moreschi revealed that Home Décor filed for bankruptcy in February, but continued to give the impression that it was still operating in Pittsburgh, charging customers and providing store hours, as if it were always open .
Dorsey received another bill this month.
“This is the statement and they wanted me to pay by August 16,” Dorsey said, showing the invoice from 11 Investigates.
In response to our report, the Attorney General’s Office advised customers not to pay any more money to the company and sent a letter of concern to the U.S. Bankruptcy Trustee regarding Home Décor’s tactic of continuing to charge. customers.
“All Pennsylvania consumers who are still being billed for layaway items should not make additional payments,” AG communications director Jacklin Rhoads wrote in an email to 11 Investigates, adding, “It is important that people who have paid for services not received file a proof of claim in the bankruptcy court.
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