HELP! Designer Vault going bankrupt and they owe me 3k!

TPF may earn a commission from merchant affiliate
links, including eBay, Amazon, and others

#46
I checked out the Chapter 7 petition online. It is a public filing but you need to have a court access password to get in to see it. It's possible if you ask the lawyer he could send you a copy. Here is more info:

The petition was signed by Christina S. as CEO. It doesn't look like the company was sold?

DV has $248k in liabilities, and $17k in assets. Of that $17k, $13k is office furniture. There is a secured creditor, Celtic Bank, that has a claim for $110k. As a secured creditor gets paid first, that is going to completely wipe out the measly assets and the likelihood of any unsecured creditors getting anything is virtually nil. The unsecured creditors, most of whom appear to be consignors, are listed on a schedule. There are 55 of them. There is a list of "executory contracts" which means unfulfilled contracts, which lists presumably consignors who have given them good to sell which remain unsold. The parties/addresses are listed.

Gross revenues for the past 3 years (Gross--so not net of expenses):

2016: $1.423m
2017: $1.185m
2018 through filing: $518k.

So clearly something happened this year where there was a 50% drop in the business.

Sorry to be the bearer of bad news, but there it is.

Disclaimer: this does not constitute legal advice.
 
  • Like
Reactions: PinkTulip, Sery Brazil, hellokimmiee and 6 others
#47
MyAwesomeFinds said:
I checked out the Chapter 7 petition online. It is a public filing but you need to have a court access password to get in to see it. It's possible if you ask the lawyer he could send you a copy. Here is more info:

The petition was signed by Christina S. as CEO. It doesn't look like the company was sold?

DV has $248k in liabilities, and $17k in assets. Of that $17k, $13k is office furniture. There is a secured creditor, Celtic Bank, that has a claim for $110k. As a secured creditor gets paid first, that is going to completely wipe out the measly assets and the likelihood of any unsecured creditors getting anything is virtually nil. The unsecured creditors, most of whom appear to be consignors, are listed on a schedule. There are 55 of them. There is a list of "executory contracts" which means unfulfilled contracts, which lists presumably consignors who have given them good to sell which remain unsold. The parties/addresses are listed.

Gross revenues for the past 3 years (Gross--so not net of expenses):

2016: $1.423m
2017: $1.185m
2018 through filing: $518k.

So clearly something happened this year where there was a 50% drop in the business.

Sorry to be the bearer of bad news, but there it is.

Disclaimer: this does not constitute legal advice.
Click to expand...
I wasn't a consignor, but thank you for posting this information!

Given that some were posting they'd receive replies from the owner while others were being told it had sold, I'm not surprised she hadn't sold it. The entire thing seems incredibly deceptive up until this point and my heart goes out to anyone impacted.
 
  • Like
Reactions: aq7588@ and bisousx
#48
I hope everybody gets their items back or gets some compensation although it seems like that might be difficult.

On a general note...I wonder if the designer resale industry is transitioning from peak to plateau and in the next couple years we might see more of this. This kind of happened with the flash sale sites...I remember after the 2008/2009 crash flash sales were all the rage and then about five years later there was a lot of consolidation and I don't think they do that well anymore. In the last couple years there have been so many new designer resale sites and at some point there will be consolidation and a "survival of the fittest" phase. I think a few will survive but probably not all.

In the interim I think all would be wise to consign few items at a time especially if they are very high price items and maybe do even more due diligence regarding who they choose to consign with...

I realize this doesn't help those who are in this conundrum with this company and I really hope you get some reprieve as it must be really frustrating.
 
  • Like
Reactions: PinkTulip, Sery Brazil, Purseonic Woman and 4 others
#49
MyAwesomeFinds said:
You don't suddenly go out of business over a demand letter. You either fight back or ignore it...then if they want to sue you they can go through the legal process but they wouldn't be getting anything right away.
Click to expand...
Maybe, but if they were on the edge financially, something like that might have been enough to push them off a cliff. Litigation is expensive.
 
#50
Any update on this thread? I saw many people left negative feedback on yelp recently so looks like number of victims are way higher than I thought earlier.
 
#52
Anyone can attend the meeting of creditors and I hope the victims show up and make sure the trustee is aware that bags were meant to be sent and never did and they still have the bags and money of items sold recently. The trustee can then request 2004 exam which gives the trustee more time to investigate to see if any fraud is occuring and get more proof from victims. After the initial meeting trustee can request they turn in their assets for evaluation.
 
  • Like
Reactions: megt10 and mia55
#55
classybags4ever said:
Just got the e-mail this morning. I consigned with them and the bag finally sold over black Friday after 6 months. I should have known something was up with them taking this long, but now with them going bankrupt, will I even get my money? They are not taking any e-mails and saying to contact their lawyer. I've sent him an e-mail and waiting.

So worried, this is a lot of money :(
Click to expand...
Omg that's terrible
 
#57
classybags4ever said:
Just got the e-mail this morning. I consigned with them and the bag finally sold over black Friday after 6 months. I should have known something was up with them taking this long, but now with them going bankrupt, will I even get my money? They are not taking any e-mails and saying to contact their lawyer. I've sent him an e-mail and waiting.

So worried, this is a lot of money :sad:
Click to expand...


Earlier post deleted. I'm a newbie and did not see and therefore did not read the conversation so I have removed all signs of my redundant blathering:) ….. ..... I'm sorry, Pa. I'll do better, I swear I will, I promise.

Seems to me there would be procedures for giving consignment items back before liquidating used items to the public . If you are on the petition what is the bank going to do, demand they liquidate your used items? But that's IF they have it. According to a previous post they have 4K in assets we didn't hear a manifest for.
4K doesn't sound like hundreds of designer bags.​

It doesn't help the original poster but for the people that think their items didn't sell, I​
see two possibilities …. Used clothing and accessories may not be considered an asset, they have them and there is a good chance to get the items back to the owners. You are still the owners of the items, no? Has anyone brought up that factoid? It is not there item. Second option is that this is all going down after black Friday for a reason. They sold most of them, had a huge weekend and moved the money, then they filed. Whatever the case I wish you all the best. Good luck. and hey, just like my folks used to say,

MERRY CHRISTMAS!!
 
Last edited:
#58
MyAwesomeFinds said:
So sorry! Yeah Chapter 7 means they will be liquidating rather than reorganizing. Hopefully you will get some sort of decent percentage back of what you are owed once the court sorts through everything.
Click to expand...


That lawyer sounds like he doesn't really care for his clients too much. Sounds like he wants to help you but his hands are tied. Could be wrong, buuut it means nothing anyway, so.... haha​
 
#59
https://bankruptcy.cooley.com/2006/...dor-get-the-goods-from-an-insolvent-customer/

https://www.korperlemonlaw.com/


The first link above addresses reclaiming property from a business in bankruptcy. Read through it, as there may be some helpful advice. I tried to find information specific to consignment, but I have limited time. CLRA - CONSUMER LEGAL REMEDIES ACT, maybe helpful to search through. The second link is an attorney, here in CA. Mr. Korper is very sharp, or he was when I knew him 17 yrs ago. However, bankruptcy laws are different. Having a discussion with an attorney maybe very helpful. The property was consigned, not sold to DV. I cannot understand how anyone's property consigned, and not yet sold (liquidated) becomes DV's property. It's out right theft, in my mind. But I'm not an attorney. Anyway, if I was a consignor in this situation, I would call an attorney that specializes in BK or an attorney that is knowledgeable in CLRA.. or an attorney that maybe knowledgeable in both. I'm not in contact with the above mentioned atty., don't know him anymore, but he was very sharp and kind.
 
  • Like
Reactions: megt10, Monaliceke and whateve
#60
Also, has anyone searched for DV incorporation? We had a business in the family, the family owner carried the note. The purchasor of the property filed BK while family member filed to foreclosure on the property, the BK filing stopped the foreclosure, the purchaser failed to show up at BK hearing, therefore within 24 hrs property foreclosure could go forward, but the purchaser then filed another BK in a different business name, again stopping foreclosure. This went on for through several purchaser business names. Finally, throughout casual discussion with an attorney, there was relief. The casual conversation determined the legal loopholes the purchaser was utilizing to avoid or delay foreclosure, and the change of family members atty to casually found atty for representation ended with an injunction against any further BK filing. 1) the purchaser had an umbrella corporation, and filed each BK under a business name within the umbrella corporation - IF DV has other names under a corporation they maybe carrying on their business - with your property. 2) if our family member never 'found' a more versed or honest atty who knows how long or how that legal issue would have resolved. The family members first atty was charging hourly for working on and appearing at each separate BK filing, the ended in just another BK filing, OT, but that firm knew better - and instead took advantage by not filing injunction. My point, do search everything you can find on DV. Your property could be listed on any site for sale by a different seller name. What does your consignment agreement state in detail.
ETA: the above was a completely different situation, but do look at DV. And above property was a multi-million dollar property and worth legal expenses, not a 3k Chanel bag.
 
You must log in or register to reply here.
Top