A West Coast retail chain’s bankruptcy continues to feed the Richmond legal scene.
More local attorneys picked up work last as a result of the June 11 bankruptcy of Gymboree, which is headquartered in San Francisco but filed its Chapter 11 case in Richmond federal court.
Creditors of the debt-ridden retailer have begun hiring lawyers on the ground in Richmond, the latest of which include Chris Perkins of LeClairRyan and Gus Epps of Christian & Barton.
They join local attorneys already on the case from Hunton & Williams, McGuireWoods and Wolcott Rivers Gates.
The lead local attorneys representing Gymboree are a group from the Richmond office of Kutak Rock. They’re working with Chicago-based Kirkland & Ellis.
Richmond hotels also will be glad to know plenty of lawyers from farther afield are likely to travel to Richmond as the case plays out.
The out-of-state firms working for creditors on the case include: Perdue, Brandon, Fielder, Collins & Mott from Arlington, Texas; Ballard Spahr from Los Angeles; Linebarge Goggan Blair & Sampson from Houston; Morris James from Wilmington, Delaware; Frost Brown Todd from Cincinnati; and Kurtzman Steady from Philadelphia, among others.
Gymboree is the latest example of large out-of-town corporations planting bankruptcies in Richmond in recent years, drawn by a court and judges here known to handle complicated bankruptcy cases in a way that’s viewed by many as favorable to debtors.
Despite being based in California, Gymboree controls an LLC that was incorporated in Virginia, which allows it to file in the commonwealth. It put eight of its affiliated corporations into Chapter 11 in Richmond on Sunday.
The company, which has 1,300 stores nationwide, was forced to file Chapter 11 as it faced more than $1 billion in debt coming due and had missed a debt payment earlier this month. The reorganization plan, which could be filed by the end of the week and confirmed in 90 days, could reduce its debts by $900 million.
Filings state the company plans to close and liquidate up to 450 stores. It has five locations in the Richmond market, according to its website – at Short Pump Town Center, Stony Point Fashion Park, Regency Square, Virginia Center Commons and Chesterfield Towne Center.
Gymboree has not yet announced which stores will close.
Judge Keith Phillips is overseeing the case in Richmond.