Sears sues Lampert, claims he looted assets to drive it into bankruptcy

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Sears sues Lampert, claims he looted assets to drive it into bankruptcy

Sears Holding Corp, an American holding company headquartered in Hoffman Estates, filed for chapter 11 bankruptcy protection back in 2018 and sold its assets to ESL investment in 2019, had sued its longtime former Chair Eddie Lampert alongside his hedge fund ESL investment, claiming that the former Chief had funneled billion of dollars of assets from the retailer and driven the company into bankruptcy.

The lawsuit had been made public on Thursday, the 18th of April 2019, and the lawsuit was filed by a restructuring team on behalf of the creditors, many of whom had blamed Lampert for the US retailer’s shortcomings.

Besides, suspicions were raised after Lampert’s hedge fund, ESL investment had bought most of Sears assets including Kenmore brands and DieHard following a bankruptcy auction. According to the lawsuit, the creditors had been seeking a repayment of billions of dollars plundered from sears including a spell of steep sell-off of core assets, which later Lampert had termed as a “death spiral” to meet daily expenses with no motive of getting profitable.

The complaint made public on Thursday (April 18th) said, “Had defendants not taken these improper and illegal actions, Sears would have had billions of dollars more to pay its third-party creditors today and would not have endured the amount of disruption, expense, and job losses resulting from its recent bankruptcy filing”.