SulmeyerKupetz Files Successful Opposition to Sports Authority’s Proposal to Abandon Consigned Goods at 112 Locations

On the evening of June 15, Sports Authority (SA) submitted an emergency request to the bankruptcy court presiding over its chapter 11 case in Delaware. SA proposed to abandon consigned goods of certain suppliers located at 112 stores that would be closing within a few days. SA requested that the court order the suppliers to retrieve the goods at the supplier’s expense and subject to clawback claims for money or subsequent recovery of the goods that might be asserted later by SA or its term lender. The next day, SulmeyerKupetz, on behalf of its client Agron, Inc., a provider of Adidas-branded products, filed an opposition to SA’s motion.

On the morning of June 17, the court held an emergency telephonic hearing. David Kupetz of SulmeyerKupetz appeared for Agron at the hearing. The court agreed with the opposition and denied SA’s requests. The court ruled that any goods returned to the consignment vendors would be free of all alleged claims and security interests. Further, as urged by SulmeyerKupetz for Agron, the court ruled that SA must conduct a physical inventory at each closing store or the court would accept any inventory count provided by Agron as correct, for purposes of addressing Agron’s claim for shrink (any discrepancy in inventory).

The SulmeyerKupetz attorneys primarily involved in the firm’s representation of Agron in the Sports Authority case are David Kupetz and Jessica Vogel.  Other attorneys at the firm providing significant services include David Richardson, Jeffrey Pomerance, and Asa Hami.

Read full Law360 article discussing the hearing.


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