Fortunoff
Encyclopedia
Fortunoff was a New York
-based retailer of home, jewelry and furniture stores founded in 1922 by Max and Clara Fortunoff. The original Fortunoff store was on Livonia Avenue in Brooklyn
, New York
. The chain's flagship store was in Westbury
, Long Island
; the store opened in 1964 and anchored The Mall at the Source, which was built around the Fortunoff store, from 1997 until Fortunoff's closing in 2009.
Fortunoff had four full-line stores in the chain. In addition to the Westbury flagship, these stores were located in White Plains, New York
, Woodbridge, New Jersey
, and Wayne, New Jersey
. In addition, Fortunoff operated 16 specialty stores: Jewelry and fine gifts were offered at the chain's shops on 57th Street in Manhattan, which closed in February 2009, and were also offered at Fortunoff's Paramus Park Mall
location. A clearance center was also operated in East Garden City, New York
. Indoor and outdoor furniture were the focus of another 14 stores throughout New York, New Jersey
, Connecticut
and Pennsylvania
; these stores were known as "Fortunoff Backyard Stores". This portion of the Fortunoff chain was revived in February 2010, although not all former Fortunoff Backyard Stores have reopened.
The chain began liquidating all of its stores on February 25, 2009; the sales concluded a little more than three months later in the first week of June 2009. In July 2009, following company dissolution, the descendants of Max and Clara Fortunoff reacquired the intellectual property
and website.
Fortunoff now does business as an online jewelry retailer, as well as operating its Backyard Stores.
and the Kier Group. However, several members of the founding family remained involved in the management and operation of the company. The sale, which originally was to have closed in December 2004, eventually closed in July 2005.
The following years saw Fortunoff continue to struggle, and on February 4, 2008, the chain filed for Chapter 11 bankruptcy
along with accepting the $
100 million sale to NRDC Equity Partners, the parent company of longtime New York retailer, Lord & Taylor
. The sale was estimated to include Fortunoff's debt of approximately $60 million. Industry analysts speculated that a likely result of the buyout by NRDC would bring Fortunoff-branded jewelry and home furnishings departments into most if not all of the 47 current Lord & Taylor locations. This list includes the department store's flagship Fifth Avenue location, where such holdings could exceed 100000 square feet (9,290.3 m²) in sales floor area—approximately one sixth of the total area of the store. The NRDC deal closed in March 2008. NRDC also released statements about intentions of infusing an additional $100 million in capital to Fortunoff and expanding the chain to over 50 stores. NRDC never followed through investing the planned capital needed to rescue the brand.
In July 2008, NRDC Equity Partners, purchased Canada
's 338-year-old retailer, the Hudson's Bay Company
. The new combined company called Hudson's Bay Trading Company
was composed of Fortunoff, Lord & Taylor
, Creative Design Studios, and the HBC
's divisions: the Bay
, Zellers
, Home Outfitters
, and Fields
. http://www.financialpost.com/story.html?id=428721
On February 5, 2009, Fortunoff filed for Chapter 11
bankruptcy, citing a weak 2008 holiday season, ballooning costs in its partnership with Lord & Taylor and reduced borrowing capacity due to the recession. Officials at Fortunoff originally hoped to sell the luxury-goods chain. Finding no takers, layoffs began on February 12, 2009, at the Fortunoff headquarters in Uniondale, New York
. A class-action lawsuit against Fortunoff by laid-off employees is underway due to violations for federal and state WARN Act laws. Many of Fortunoff's vendors were lured into shipping increased consignments of merchandise and goods for the Fortunoff/Lord and Taylor venture prior to the abrupt bankruptcy filing one year and a day after NRDC's purchase of the company. The timing of the filing allowed NRDC's Fortunoff "shell" companies created during the initial purchase a "secured creditor" position above other creditors.
On February 17, 2009, Fortunoff stopped accepting its gift cards as payment, angering customers. A bankruptcy auction was scheduled for February 23, 2009.
SimplexDiam Inc. of New York City was entrusted with auctioning the residual diamonds from the fine jewelry division.
When the company was in process of being liquidated, plans to brand Lord & Taylor
's fine jewelry and home-furnishing departments under the Fortunoff brand were canceled.
During the Spring of 2009, CONSOR Intellectual Asset Management was retained to sell the Fortunoff brand
, intellectual property
and related intangible assets. As a result of that effort, in July 2009, the Fortunoff brand and intellectual property were reacquired by David Fortunoff and members of the Fortunoff and Mayrock families with the possibility of relaunching the brand.
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
-based retailer of home, jewelry and furniture stores founded in 1922 by Max and Clara Fortunoff. The original Fortunoff store was on Livonia Avenue in Brooklyn
Brooklyn
Brooklyn is the most populous of New York City's five boroughs, with nearly 2.6 million residents, and the second-largest in area. Since 1896, Brooklyn has had the same boundaries as Kings County, which is now the most populous county in New York State and the second-most densely populated...
, New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
. The chain's flagship store was in Westbury
Westbury, New York
Westbury incorporated in 1932 as a village in Nassau County, New York in the United States. The population was 15,146 at the 2010 census.The Village of Westbury is in the Town of North Hempstead....
, Long Island
Long Island
Long Island is an island located in the southeast part of the U.S. state of New York, just east of Manhattan. Stretching northeast into the Atlantic Ocean, Long Island contains four counties, two of which are boroughs of New York City , and two of which are mainly suburban...
; the store opened in 1964 and anchored The Mall at the Source, which was built around the Fortunoff store, from 1997 until Fortunoff's closing in 2009.
Fortunoff had four full-line stores in the chain. In addition to the Westbury flagship, these stores were located in White Plains, New York
The Source At White Plains
The Source at White Plains is a large urban-style shopping complex in downtown White Plains, New York. Located across the street from The Westchester mall and a large Crowne Plaza hotel, it features several major brand-name retailers and restaurants, such as The Cheesecake Factory, Whole Foods...
, Woodbridge, New Jersey
Woodbridge Center
Woodbridge Center is a two-level, major shopping mall located in Woodbridge Township, New Jersey at the intersection of U.S. Route 1 and U.S. Route 9. The land that Woodbridge Center now stands on used to be the location of the old clay pits in Woodbridge. The mall, owned by General Growth...
, and Wayne, New Jersey
Wayne Towne Center
The Wayne Towne Center is a regional shopping center located in Wayne, New Jersey, right next to Willowbrook Mall. As of 2008, the mall had a gross leasable area of . The center formerly operated as an indoor shopping mall from the time of its building as the West Belt Mall in the 1970s until 2008,...
. In addition, Fortunoff operated 16 specialty stores: Jewelry and fine gifts were offered at the chain's shops on 57th Street in Manhattan, which closed in February 2009, and were also offered at Fortunoff's Paramus Park Mall
Paramus Park
Paramus Park is a shopping center located on From Road in Paramus, New Jersey, United States, sandwiched between Route 17 and the Garden State Parkway, a little more than two miles north of Route 4. The mall is owned by General Growth Properties and offers a Gross leasable area of...
location. A clearance center was also operated in East Garden City, New York
East Garden City, New York
East Garden City is a census-designated place in the northeast part of the Town of Hempstead, in the central part of Nassau County, New York, along the Hempstead/North Hempstead town line. The population was 6,028 at the 2010 census...
. Indoor and outdoor furniture were the focus of another 14 stores throughout New York, New Jersey
New Jersey
New Jersey is a state in the Northeastern and Middle Atlantic regions of the United States. , its population was 8,791,894. It is bordered on the north and east by the state of New York, on the southeast and south by the Atlantic Ocean, on the west by Pennsylvania and on the southwest by Delaware...
, Connecticut
Connecticut
Connecticut is a state in the New England region of the northeastern United States. It is bordered by Rhode Island to the east, Massachusetts to the north, and the state of New York to the west and the south .Connecticut is named for the Connecticut River, the major U.S. river that approximately...
and Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
; these stores were known as "Fortunoff Backyard Stores". This portion of the Fortunoff chain was revived in February 2010, although not all former Fortunoff Backyard Stores have reopened.
The chain began liquidating all of its stores on February 25, 2009; the sales concluded a little more than three months later in the first week of June 2009. In July 2009, following company dissolution, the descendants of Max and Clara Fortunoff reacquired the intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...
and website.
Fortunoff now does business as an online jewelry retailer, as well as operating its Backyard Stores.
Ownership
The Fortunoff and Mayrock families, descendants of the founders, owned 100% of the company until November 2004, when a 75% interest in the company was acquired by Trimaran Capital PartnersTrimaran Capital Partners
Trimaran Capital Partners is a middle-market private equity firm formerly affiliated with CIBC World Markets. Trimaran is headquartered in New York City and founded by former investment bankers from Drexel Burnham Lambert. Trimaran’s predecessors were early investors in telecom and Internet...
and the Kier Group. However, several members of the founding family remained involved in the management and operation of the company. The sale, which originally was to have closed in December 2004, eventually closed in July 2005.
The following years saw Fortunoff continue to struggle, and on February 4, 2008, the chain filed for Chapter 11 bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
along with accepting the $
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
100 million sale to NRDC Equity Partners, the parent company of longtime New York retailer, Lord & Taylor
Lord & Taylor
Lord & Taylor, colloquially known as L&T, or LT, based in New York City, is the oldest upscale, specialty-retail department store chain in the United States. Concentrated in the eastern U.S., the retailer operated independently for nearly a century prior to joining American Dry Goods...
. The sale was estimated to include Fortunoff's debt of approximately $60 million. Industry analysts speculated that a likely result of the buyout by NRDC would bring Fortunoff-branded jewelry and home furnishings departments into most if not all of the 47 current Lord & Taylor locations. This list includes the department store's flagship Fifth Avenue location, where such holdings could exceed 100000 square feet (9,290.3 m²) in sales floor area—approximately one sixth of the total area of the store. The NRDC deal closed in March 2008. NRDC also released statements about intentions of infusing an additional $100 million in capital to Fortunoff and expanding the chain to over 50 stores. NRDC never followed through investing the planned capital needed to rescue the brand.
In July 2008, NRDC Equity Partners, purchased Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
's 338-year-old retailer, the Hudson's Bay Company
Hudson's Bay Company
The Hudson's Bay Company , abbreviated HBC, or "The Bay" is the oldest commercial corporation in North America and one of the oldest in the world. A fur trading business for much of its existence, today Hudson's Bay Company owns and operates retail stores throughout Canada...
. The new combined company called Hudson's Bay Trading Company
Hudson's Bay Trading Company
Hudson's Bay Trading Company, L.P. is an American portfolio company for NRDC Equity Partners, a private equity company. Hudson's Bay Trading Company was founded in 2008....
was composed of Fortunoff, Lord & Taylor
Lord & Taylor
Lord & Taylor, colloquially known as L&T, or LT, based in New York City, is the oldest upscale, specialty-retail department store chain in the United States. Concentrated in the eastern U.S., the retailer operated independently for nearly a century prior to joining American Dry Goods...
, Creative Design Studios, and the HBC
HBC
- Medical terminology :*Hepatitis B virus#Genome, the Hepatitis B core protein*Hemoglobin C*Hormonal contraception , hormonal methods for preventing pregnancy- Companies and organizations :...
's divisions: the Bay
The Bay
The Bay is a chain of 91 department stores that operate across parts of Canada. It is the main brand of Hudson's Bay Company , North America's oldest company. It has its headquarters in the Simpson Tower in Toronto. In French, the chain is known as la Baie, short for "Compagnie de la Baie d'Hudson"...
, Zellers
Zellers
Zellers Inc. is Canada's second-largest chain of mass merchandise discount stores, with locations in communities across Canada. A subsidiary of the Hudson's Bay Company , it has 273 locations across the country....
, Home Outfitters
Home Outfitters
Home Outfitters is Canada's largest kitchen, bed, and bath superstore, with 69 stores across the country selling bedding, towels, housewares, and other home accessories....
, and Fields
Fields (department store)
Fields is a brand of Canadian discount stores owned by Hudson's Bay Company, with 165 locations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Yukon, and Northwest Territories.- History :...
. http://www.financialpost.com/story.html?id=428721
On February 5, 2009, Fortunoff filed for Chapter 11
Chapter 11, Title 11, United States Code
Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...
bankruptcy, citing a weak 2008 holiday season, ballooning costs in its partnership with Lord & Taylor and reduced borrowing capacity due to the recession. Officials at Fortunoff originally hoped to sell the luxury-goods chain. Finding no takers, layoffs began on February 12, 2009, at the Fortunoff headquarters in Uniondale, New York
Uniondale, New York
Uniondale is a hamlet as well as a suburb of New York City in Nassau County, New York, United States, on Long Island, in the Town of Hempstead. The population was 24,759 at the 2010 United States Census.-Geography:...
. A class-action lawsuit against Fortunoff by laid-off employees is underway due to violations for federal and state WARN Act laws. Many of Fortunoff's vendors were lured into shipping increased consignments of merchandise and goods for the Fortunoff/Lord and Taylor venture prior to the abrupt bankruptcy filing one year and a day after NRDC's purchase of the company. The timing of the filing allowed NRDC's Fortunoff "shell" companies created during the initial purchase a "secured creditor" position above other creditors.
On February 17, 2009, Fortunoff stopped accepting its gift cards as payment, angering customers. A bankruptcy auction was scheduled for February 23, 2009.
Liquidation
On February 25, Reuters announced that the bankruptcy auction for Fortunoff resulted in the chain being sold to a group of seven liquidators and that going out of business sales would begin immediately. Fortunoff stopped accepting returns at that time and declared that any purchase made after February 16 was considered to be final.SimplexDiam Inc. of New York City was entrusted with auctioning the residual diamonds from the fine jewelry division.
When the company was in process of being liquidated, plans to brand Lord & Taylor
Lord & Taylor
Lord & Taylor, colloquially known as L&T, or LT, based in New York City, is the oldest upscale, specialty-retail department store chain in the United States. Concentrated in the eastern U.S., the retailer operated independently for nearly a century prior to joining American Dry Goods...
's fine jewelry and home-furnishing departments under the Fortunoff brand were canceled.
During the Spring of 2009, CONSOR Intellectual Asset Management was retained to sell the Fortunoff brand
Brand
The American Marketing Association defines a brand as a "Name, term, design, symbol, or any other feature that identifies one seller's good or service as distinct from those of other sellers."...
, intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...
and related intangible assets. As a result of that effort, in July 2009, the Fortunoff brand and intellectual property were reacquired by David Fortunoff and members of the Fortunoff and Mayrock families with the possibility of relaunching the brand.