Pelley Law Office LLP
Dallas Office
Plano Office
Sherman Office
214-733-1775
972-608-0335
903-813-4778

No Charge For Initial Consultation ($250 value)

Menu Contact

Over 80 Years Of Combined Experience

View Our Practice Areas

Blockbuster Bankruptcy Could Hit Employees Where it Hurts

When big businesses file for bankruptcy, there is a ripple effect that occurs. Not only do the shareholders and suppliers suffer, as well as any lenders who are owed outstanding debts, but the company's employees take a tough hit to their job security, pocketbooks and overall confidence in having to find a decent job in a down economy. This may be the case for Blockbuster employees in both its Dallas and McKinney, Texas locations.

Blockbuster Inc., whose headquarters moved from Fort Lauderdale, Florida, to Dallas, Texas, in 1996, filed for bankruptcy in late 2010.

Between the poor state of the U.S. economy over the last few years and intense competition from competitors like Netflix, Blockbuster had continued to experience significant and sustained losses prior to filing for bankruptcy protection. At the time of filing, the company was $900 million in debt. Blockbuster attempted to close many of its stores and reorganize its business both before and after filing for bankruptcy, but earlier this year the U.S. Department of Justice disclosed that the company is out of funds and needs to liquidate.

To address the consequences of a possible purchase of the dying company, Blockbuster sent a letter to the Texas Workforce Commission, a regulatory body, in February warning that a sale could result in 865 employee layoffs. This number includes all 238 employees remaining at its Dallas headquarters and 627 employees at its McKinney distribution facility. While the letter was a valiant attempt that Blockbuster was looking to stay afloat and protect its employees, the letter was to no avail.

In early April, the Dish Network won Blockbuster at auction for $320 million.

Business analysts anticipate that Dish Network will close further Blockbuster stores as it works to resolve the company's dire financial situation. While the fate of many store employees is already sealed, what will happen to other existing Blockbuster employees in Dallas and McKinney, Texas, and elsewhere in the country, is still a mystery. Regardless, the country will continue to feel the effects of both the company's bankruptcy and its recent sale over the coming months.

If you are considering bankruptcy as an option for either yourself or your business, be sure to seek the advice of an experienced Texas bankruptcy attorney before trying to reorganize or file for bankruptcy protection. A lawyer versed in bankruptcy law may be able to help you protect you or minimize any impact you may feel throughout this process.

No Comments

Leave a comment
Comment Information

Awards & Recognition

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Office Locations

Plano office
Sherman office
Dallas office

Plano Office
1312 14th Street, Suite 100
Plano, Texas 75074

Phone: 972-608-0335
Map & Directions

Sherman Office
905 North Travis Street
Sherman, Texas 75090

Phone: 903-813-4778
Map & Directions

Dallas Office
6060 North Central Expressway, Suite 602
Dallas, Texas 75206

Phone: 214-733-1775
Map & Directions