Online discounter Overstock.com has offered global goods merchant Eziba $500,000 for all of its assets. But a sale of the all-but-defunct company may not occur until Eziba declares bankruptcy. So far the North Adams, MA-based merchant has tried to avoid that option.
Eziba suspended operations in mid-January and laid off two-thirds of its workforce. The company blamed its woes on a computer error that sent tens of thousands of fall catalogs to the wrong addresses, resulting in lower-than-expected September and October.
According to attorney Joseph Collins of Hendel and Collins in Springfield, MA, when involuntary bankruptcy is filed, the court must appoint an interim trustee. The trustee negotiates the sale and then must go to court to get the sale approved. “Higher counteroffers can be submitted, and then all offers are considered,” Collins explains.
At least three creditors are seeking remuneration from Eziba, according to the federal bankruptcy court in Boston. Media relations company Rudder Finn of Newton, MA, claims that it is owed $11,155, printer Arandell Corp. of Wisconsin claims that it is owed $230,000, and customer management service company Clientlogic claims that it is owed $127, 635. A meeting of all Eziba creditors is planned for March 7 at the Berkshire County Superior Court.