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Sixth Avenue Electronics Shut Down
Court orders shut down of New Jersey-based specialty retailer Sixth Avenue Electronics after lawsuit by its major creditor GE is owed $5.8M. Toshiba also sues for $1.2M.
Court orders shut down of specialty retailer Sixth Avenue Electronics after lawsuit by its major creditor GE is owed $5.8M. Toshiba also sues for $1.2M.
Sixth Avenue Electronics could be deep-sixed.
The New Jersey-based specialty retailer is on the verge of having all its inventory seized by its major creditor, GE Commercial Distribution Finance Corp. (CDF), claiming it is owed over $5.8 million. Simultaneously, Sixth Avenue was sued by Toshiba, claiming it was owed $1.2 million.
GE CDF filed suit in U.S. District Court on Sept. 30 alleging that Sixth Avenue Electronics City Inc. has defaulted on its promised payments, including missing a payment of $2.1 million due on September 12. GE CDF had an agreement in place with Sixth Avenue to finance all of the retailer’s product sales.
As collateral for that arrangement, GE CDF has the ability to seize “all inventory, equipment and fixtures” of Sixth Avenue in the event of default so it can sell the inventory. The agreement terms were renegotiated back in March of this year, but the court documents allege that Sixth Avenue still defaulted.
GE CDF estimates in the court documents (pdf) that Sixth Avenue has collateral worth “at most, $12 million” in its possession. GE CDF worries that the retailer will try to “dissipate, conceal or sell” much of its remaining collateral without remitting future payments. So, the court issued a temporary order forcing the immediate shut down of Sixth Avenue’s three remaining New Jersey stores in Paramus, Woodbridge and Somerset, along with its distribution warehouse in Springfield, N.J.
Sixth Avenue has been an authorized reseller for Toshiba since October 2009. According to the court documents (pdf) filed in U.S. District Court for the Southern District of New York, the retailer is “long past due” on its payments.
The news is another signal of the struggles being experienced by most specialty retailers, including Best Buy who has reported sales drops recently. The trend is another reason so many of these companies have migrated to become custom integrators with private showrooms.
Other brands sold by Sixth Avenue, which has been in business since 1984, include Sony, Sharp, Pioneer, Denon, Panasonic, Monster, Bell'o, OmniMount, Definitive Technology, Jamo, Yamaha, Onkyo, KEF, Klipsch, Paradigm, Polk Audio and others.
The New Jersey-based specialty retailer is on the verge of having all its inventory seized by its major creditor, GE Commercial Distribution Finance Corp. (CDF), claiming it is owed over $5.8 million. Simultaneously, Sixth Avenue was sued by Toshiba, claiming it was owed $1.2 million.
GE CDF filed suit in U.S. District Court on Sept. 30 alleging that Sixth Avenue Electronics City Inc. has defaulted on its promised payments, including missing a payment of $2.1 million due on September 12. GE CDF had an agreement in place with Sixth Avenue to finance all of the retailer’s product sales.
As collateral for that arrangement, GE CDF has the ability to seize “all inventory, equipment and fixtures” of Sixth Avenue in the event of default so it can sell the inventory. The agreement terms were renegotiated back in March of this year, but the court documents allege that Sixth Avenue still defaulted.
GE CDF estimates in the court documents (pdf) that Sixth Avenue has collateral worth “at most, $12 million” in its possession. GE CDF worries that the retailer will try to “dissipate, conceal or sell” much of its remaining collateral without remitting future payments. So, the court issued a temporary order forcing the immediate shut down of Sixth Avenue’s three remaining New Jersey stores in Paramus, Woodbridge and Somerset, along with its distribution warehouse in Springfield, N.J.
Sixth Avenue has been an authorized reseller for Toshiba since October 2009. According to the court documents (pdf) filed in U.S. District Court for the Southern District of New York, the retailer is “long past due” on its payments.
The news is another signal of the struggles being experienced by most specialty retailers, including Best Buy who has reported sales drops recently. The trend is another reason so many of these companies have migrated to become custom integrators with private showrooms.
Other brands sold by Sixth Avenue, which has been in business since 1984, include Sony, Sharp, Pioneer, Denon, Panasonic, Monster, Bell'o, OmniMount, Definitive Technology, Jamo, Yamaha, Onkyo, KEF, Klipsch, Paradigm, Polk Audio and others.
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About the Author
Jason has covered low-voltage electronics as an editor since 1990. He joined EH Publishing in 2000, and before that served as publisher and editor of Security Sales, a leading magazine for the security industry. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He is currently a member of the CEDIA Education Action Team for Electronic Systems Business. Jason graduated from the University of Southern California.
6 Comments (displayed in order by date/time)
Wish i could get some sucker… i mean company!! to give me several million dollars worth of product on credit.
One less source customers can give us pricing on that is less than our direct cost.
Someone else will take their place and mindless creditors dole out money.
HAVE A 5 YEAR GUARANTEE ON MY TV I BOUGHT FROM THEM AND IT JUST BROKE AFTER 3 1/2 YEARS. THEY ARE THE INSURER OF IT. NOW WHAT DO I DO? ALL STORES CLOSED AND CAN’T GET ANYONE ON PHONE. ANY IDEAS?
Willie, you are out of luck if 6th was “underwriter” of the policy. Read the fine print to see if there was a third party involved and contact them if so. step
TUCK
NO THIRD PARTY. GUESS I AM S.O.L.
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Wow, you could knock me over with a feather.
really am shocked they lasted this long.