Michael1942's Blog

This is the result of “gamblers” buying into an established business and not knowing the workings of the business. That lack of knowledge allows for the fatal mistakes made in the business model and opening the door for failure. This debacle leads to the “gambler” going after whatever assets that are available on the backs of the workers and gutting the business for whatever assets that can be gleaned after the business is no longer viable. Those assets include real estate that is often more valuable than the business after being gutted.  We should hope that the courts find for the plaintiffs to create a precedent for the future “Gamblers” MA.

By Jonathan Stempel and Jessica DiNapoli 18 hrs ago

Sears Holdings Corp sued longtime former chairman Eddie Lampert, his hedge fund ESL Investments and others like Treasury Secretary Steven Mnuchin, claiming they illegally siphoned billions of dollars of assets from the retailer before it went bankrupt.
The lawsuit, made public on Thursday, was filed by the restructuring team winding down Sears’ bankruptcy estate and suing on behalf of creditors, many of whom blame Lampert for the retailer’s downfall.
It followed the billionaire’s $5.2 billion purchase in February of most Sears assets, including the DieHard and Kenmore brands, after a bankruptcy auction.
The complaint seeks the repayment of “billions of dollars of value looted from Sears,” including while it was in what Lampert would later call a “death spiral” where it sold core assets to meet daily expenses with no real plan for becoming profitable.
“Had defendants not taken these improper and illegal actions, Sears would have had billions of dollars more to pay its third-party creditors today and would not have endured the amount of disruption, expense, and job losses resulting from its recent bankruptcy filing,” the complaint said.
Sears filed for Chapter 11 protection in October after a prolonged decline under Lampert marked by large losses, scant investment and lost market share to retailers such as Walmart Inc, Home Depot Inc and Amazon.com Inc.
Others sued include ESL President Kunal Kamlani; Bruce Berkowitz and his Fairholme Capital Management, which was a large Sears shareholder; and Seritage Growth Properties, which took over 266 of Sears’ best stores in a 2015 spinoff.
Mnuchin, a college roommate of Lampert’s at Yale University, had been a director at Sears and ESL, and previously worked with Lampert at Goldman Sachs.
In a statement on behalf of ESL, Lampert and Kalmani, ESL said it vigorously disputed the lawsuit, calling the allegations “misleading or just flat wrong,” and saying all transactions were done in good faith and for shareholders’ benefit.
Fairholme said it was reviewing the complaint. Seritage and the Treasury Department did not immediately respond to requests for comment.
‘DEATH SPIRAL’
Lampert created Sears Holdings through the 2005 merger of Sears, Roebuck & Co and Kmart Holdings Corp.
According to the complaint, Lampert and other insiders had by 2011 begun hatching a plan to “strip” Sears of assets, as the Hoffman Estates, Illinois-based retailer’s performance fell short and more ESL investors were demanding their money back.
The complaint said Lampert ordered the creation of bogus financial plans projecting a Sears turnaround, and used them to help transfer five major assets worth more than $2 billion, including Land’s End and Sears Hometown Outlet.
Sears’ bankruptcy estate in particular faulted the conduct of Lampert and others in the $2.58 billion Seritage spinoff.
It said that transaction undervalued the real estate by at least $649 million, stuck Sears with hundreds of millions of dollars of rent and fees from leasing most of the 266 stores back, and was structured to benefit favored shareholders like Lampert, in part through Seritage’s payment of dividends.
Seritage reported $24.1 million of funds from operations in 2018, a measure of cash flow, and last July obtained a $2 billion loan package from Warren Buffett’s Berkshire Hathaway Inc. Berkshire is not a defendant.
Thursday’s lawsuit was filed with the U.S. bankruptcy court in White Plains, New York.
It seeks a declaration that the alleged looting constituted “fraudulent transfers” that should be undone or, more likely, justified damages.
The reorganized Sears was expected to have about 425 Sears and Kmart stores, down from roughly 3,500 at the time of the 2005 merger.
The case is Sears Holdings Corp et al v Lampert et al, U.S. Bankruptcy Court, Southern District of New York, No. 19-ap-08250. The main bankruptcy case is In re Sears Holdings Corp in the same court, No. 18-bk-23538.

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The calls for SHS to be fired are just talk as a consummate liar will not fire another consummate liar especially when that liar covers his butt and forwards his lies with impunity. We have known that any spokespeople for the current administration are not reliable except for the fact that they will lie for and with TOTUS.MA

Lauren Tyler
April 19, 2019
Sarah Huckabee Sanders was on Hannity Thursday night after the Mueller report revealed that Sanders lied about the FBI’s reaction to the James Comey firing. During the interview, she admitted to Sean Hannity that she wasn’t fully truthful in her press conference after Comey was fired.
“Look, I acknowledged that I had a slip of the tongue when I used the word ‘countless,’ but it’s not untrue.”
Sanders formerly stated that “countless” FBI executives were thankful Trump fired Comey. On May 10, 2017, the day after Comey was fired, Sanders told reporters, “I think most of America had decided on their own that Director Comey was not the person that should be leading the FBI, as evidenced by the numerous comments that we’ve seen from Democrat members in the House and Senate, Republican members, members of the FBI, and people across the board.”
However, in a redacted report presented by Attorney General William Barr to Congress and the public Thursday morning, it was revealed that Sanders admitted that her statements regarding FBI reaction to Comey’s firing were not true.
“Sanders told this Office [of the special counsel] that her reference to hearing from ‘countless members of the FBI’ was a ‘slip of the tongue.’
It was also revealed that her statements that FBI agents had “lost confidence” in Comey were made in “the heat of the moment” and “not founded on anything.”
On Hannity, Sanders maintained that Comey should have been fired.
“James Comey was a disgraced leaker who tried to politicize and undermine the agency he was supposed to run,” she explained.
Twitter has exploded with reactions from journalists calling for Sanders to be fired.

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