Footwear News learned today that a general receiver — Inverness Group — was appointed Thursday by the Superior Court of Washington for King County to handle Shoes.com’s remaining assets in the U.S. This receivership process is a form of corporate bankruptcy.
Meanwhile, sources close to the situation told FN that the firm’s Canadian parent will file bankruptcy in Canada today.
For U.S.-based Shoes.com customers, FN has learned that at some point creditors and possibly customers will be notified of the receivership and of the ability to file claims if they think they’re owed money by the firm.
However, since the receivership process was initiated by Wells Fargo — which is owed roughly $4 million and has the first dibs on all assets of the company — sources say that it remains questionable, considering the level of debt at Shoes.com, whether there will be enough money to pay off other creditors and/or customers. (There are two other secured creditors that are junior to Wells Fargo, and secured debt is prioritized over unsecured debt.)
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Meanwhile, representatives for several brands — including Earth Brands Footwear and Ros Hommerson — have come forward to state that they can be contacted by customers regarding exchanges and/or returns of merchandise for Shoes.com and its affiliates. (A spokesperson for Earth Brands told FN today that the brand is happy to field calls and emails from Shoes.com consumers and will help with exchanges but won’t be able to take returns.)
Since abruptly announcing that it would shutter options Jan. 27, Shoes.com took all three of its e-commerce properties — Shoes.com, OnlineShoes.com and ShoeME.ca — offline, and also shut down the two Shoes.com brick-and-mortar stores in Toronto and Vancouver, Canada.
Shoes.com said its employees were made aware of the decision Jan. 27 and were compensated through the end of the month.
Footwear News reached out to Inverness Group and was told that the receiver does not have a comment at this time.