What it means for customers when a company like H. H. Gregg files bankruptcy

Customers are wondering how they'll be affected after H.H. Gregg announced their bankruptcy and plans to close all stores (WSYX/WTTE)

H.H. Gregg is closing all 220 stores. The consumer electronics retailer says it's begun the liquidation process.

Gahanna customer Mariellen Brenner reached out to Six On Your Side, wondering how the bankruptcy will affect her. In January, Brenner bought a 60-inch television for about $600. "I got a 5-year protection plan and that way if anything happened, they would come to the house and repair it or replace it," she said. That cost an extra $200.

Now that H.H. Gregg is closing, she fears her 5-year warranty is now worthless.

"I felt that with the protection plan being under H.H. Gregg and they go bankrupt then I won't have any way to get my TV repaired if something happens to it," she said.

Columbus bankruptcy lawyer A. C. Strip says in most cases, if a company owes you money, goods, or services and shuts down, you're probably not gonna get anything.

"Your rights are very little," said Strip. "In fact, if they're out of business and the store is dark, you are at that point a creditor, unfortunately, just like any other creditor. And the likelihood of your recovering anything is very dim indeed."

That's because "secured" creditors like banks will get paid off by a bankruptcy court before "unsecured" creditors like customers.

Here are the top things to know if you're a customer:

  • If you hold a gift card from a troubled company, use it quickly
  • If you've made a down payment you can ask for a refund or you may have to file a claim with the bankruptcy court
  • If you've paid for a warranty, it may come down to whether it's from the company itself, the manufacturer, or a third party

In a statement to Six On Your Side, H. H. Gregg said it would honor everything.

We are continuing to operate in the ordinary course. We plan to honor delivery of our customer orders. Our manufacturers will continue honoring the warranty on customer purchases. The extended warranties purchased are administered through a third-party company, Warrantech. These extended warranties will also be honored for the life of the contract.

So for customers like Mariellen, that means her extended warranty will continue to be honored. "Well that would be fine. That's all I want," she said.

If you have an H. H. Gregg gift card, you have only two weeks during which to use it during the liquidation process. After that it will be worthless.

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