Bradlees says it will honor gift certificates and cash cards By Carolyn Rushefsky Staten Island Advance 12/30/2000

By CAROLYN RUSHEFSKY
December 30, 2000
ADVANCE BUSINESS WRITER

Hundreds of consumers like Debbie Gamble of Port Richmond were understandably bitter when Bradlees, which abruptly filed for bankruptcy the day after Christmas, announced it would not honor gift certificates or allow merchandise exchanges. Mrs. Gamble had bought $100 in gift certificates for her mother at the Travis discount store.

Then in an abrupt turnaround, Bradlees announced late yesterday that it would honor its gift certificates and cash cards in all its 105 stores until the close of business Jan. 15.

Bradlees also said it would exchange until Jan. 15 non-defective merchandise bought before Dec. 26 that is accompanied by the original cash register receipt. The store, which closed at 5 p.m. yesterday for inventory, reopened this morning at 9 a.m.

The merchandise in Bradlees stores is in the hands of Boston-based liquidator Gordon Brothers Retail Partners.

"I'm glad to hear that my mother will get to use her gift certificates," Mrs. Gamble said after the Advance told her the news late yesterday. "But we called Bradlees just this afternoon (Friday) and asked them about it and they said no gift certificates will be honored; they're crazy.

"I gave gift certificates to my mother because she loved to shop in Bradlees, but when she got to the checkout Thursday, they wouldn't take them," Mrs. Gamble complained. "Gift certificates should be just like cash," she said. "That's not right."

"It's a store that average people shop at," added Ann Stringile, Great Kills, who was unable to return an outfit and a nightgown or use a $15 cash card that she'd bought before the holiday. "For them to pull something like that before Christmas -- I'm furious."

She added that someone at Bradlees told her that it's legal; the courts say it's OK. "That's a shame, doing this to poor people who can't afford it," she said.

It might be shameful or dishonorable or despicable, but Bradlees' original refusal to accept gift certificates or exchanges is perfectly legal, experts say.

Mrs. Stringile, Mrs. Gamble's mom, and other gift certificate holders have become creditors in the bankruptcy proceeding, just like suppliers of retail merchandise, equipment, services, utilities and everything else, explained Brad Maione, spokesman for Attorney General Eliot Spitzer's office.

"Everything goes to the bankruptcy court, and there's a process in place for consumers to file a claim," Maione said.

"By law, Bradlees is not required to honor gift certificates," added Marylou Ducey-Martin, attorney with the law firm of Corash Hollender Martin & McVay, West Brighton. "Their bankruptcy filing date, which was Tuesday, is the triggering date after which they don't have to honor gift certificates, she said.

While they will have the right to file claims in bankruptcy court, she continued, the good news is that customer claims do have a higher level of priority than other debts, Ms. Ducey-Martin said. The bad news is, "It doesn't mean everyone will be paid the full amount they're owed."

She also noted that the offices of the attorney general in Massachusetts and Connecticut had sought a court order that would force Bradlees to honor gift certificates and exchanges during its bid for bankruptcy. Those claims were filed in the U.S. Bankruptcy Court in New York, where Bradlees filed for Chapter 11 bankruptcy protection. Apparently, these moves are what prompted the Braintree, Mass.-based Bradlees to reconsider its stand on gift certificates and exchanges.

Asked what consumers should do if Bradlees reneges on its promise to redeem gift certificates, or if they are unable to redeem them by the Jan. 15 deadline, Maione urges consumers to call the Attorney General's consumer hotline at 800 771-7755 and file a complaint with the Consumer Fraud and Protection Bureau.

MaryAnn Storniolo of Oakwood, holder of a cash card, essentially a plastic gift certificate, complained, "How could they sell $100 gift cards to people one week, and not honor them (the next)"? Kathleen Lopa of Oakwood, who was unable to change one chair cover for the exact same one in a different color, summed up everyone's feelings with: "It's not fair to all those people who did their Christmas shopping here."

Jody S. Hall, deputy commissioner of the city Department of Consumer Affairs, noted that its consumer protection laws are not able to aid Island shoppers because "Bankruptcy law supersedes city law." But the agency can help consumers file claims in bankruptcy court, said Ms. Hall, a Castleton Corners resident and former Bradlees shopper.

"I was in there the Saturday before and the day after Christmas. I had no idea they were going to close," she said.

For help in filing a claim with the bankruptcy court, Ms. Hall suggests that burned Bradlees' shoppers call the Consumer Department's helpline at 212 487-4444.

If her mother is unable to cash those gift certificates as promised, Mrs. Gamble is likely to be among those callers.

"They knew they were going out of business when they sold those gift certificates to me just before Christmas," Mrs. Gamble said. "That's fraud."

The secret to our success is that we care about our clients