Personal Finance 

Linens ‘n Things May Declare Bankruptcy, Don’t Hold Gift Cards!

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It took a while but LNT is liquidating its remaining stores as of October 14th, 2008.

Linen ‘n Things has filed for Chapter 11 bankruptcy, freezing $42M in gift cards.

We received many gift cards as wedding gifts (thanks!) and fortunately none of them were Linens ‘n Things cards because they’ll be filing for bankruptcy tomorrow ($15 million quarterly payment is due!). What does this mean for gift card holders? There is a possibility that Linens, as Sharper Image did, will suspend the acceptance of gift cards and anyone holding one will be left with nothing. Gift card holders are considered unsecured creditors during bankruptcy, which puts them after secured creditors and thus less likely to receive anything. You didn’t think you were lending a company money when you bought it, huh? 🙂

America has spent the last twenty five years in a state of heightened consumerism, with relatively few retailer busts. The probability that you could have a gift card from a publicly traded company go worthless was pretty slim. Suddenly, you have Bombay bust last year, followed by Sharper Image, and you start seeing that the little spending train we’ve been riding is starting to slow down and the risk of a gift card becoming worthless plastic go up. To be honest, I had no idea Sharper Image went under (though I never understood how they kept afloat, those gadgets were cool but expensive and hardly ever “necessary”) until long after they were liquidating. (anyone else with me?) Who has time to keep track of that? I don’t, I’d guess you don’t either.

So, the lesson of the day is to spend down those gift cards as soon as possible. We have gift cards from places like Macy’s and Bed Bath & Beyond (which is a store just like Linens ‘n Things), and while the future looks good for them (honestly, we have no idea how the future looks for them, it’s not like Linens ‘n Things was visibly struggling) you never know what can happen.

Need another reason to not like gift cards? This seems like a pretty strong one. Cash doesn’t expire and if the US Government ever declares bankruptcy, the least of your worries will be what Federal Reserve Note gets you in bankruptcy proceedings.

If anyone is currently working at LNT and would like to write about their experience, please contact me, thanks!

{ 33 comments, please add your thoughts now! }

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33 Responses to “Linens ‘n Things May Declare Bankruptcy, Don’t Hold Gift Cards!”

  1. MincrimeII says:

    As a current GM for the company ( for the next few months) I can tell you of a few issues.
    1. Return policy blows. I had a guest come in and do a return on a bedding item that she had for four months. You can tell she had washed it and did not follow the instructions. She tried to give me some lame ass reason about 4 deaths in her family and all this other crap. To be honest I usually extend the return for a couple of days. But once you lie to me or act like a bitch I could care less. Does she think she can take an item to another retailer such as Best Buy or Target and think they are going to give her store credit or cash back after the return date has expired? HELL NO!!!
    2. Poor ads. The ads are weak and we have been out of the items at times. But they ads are better than BBB. Not sure how you can fix this. Maybe another ad agency. Too late I’m sure.
    3. Like the author of this story about Gift cards and not being able to use them. Just like most reporters or media outlets today. WRONG, WRONG, WRONG. Most reports talk out of their asses and have no clue because they report BEFORE they get the facts. So do your job and get the facts before you speak.
    4. Poor locations of their stores. Old locations stay open while new malls open up. Must be due to lower rent.

    Oh well…………we gave it a good battle. My store gave great guest service and we looked good. We always tried to exceed the guest expectations everyday. Even for the bitches and thieves.


  2. Mikal says:

    I worked in management for the company for five years. LNT will go down. They treat there employees and department managers unfairly, the only thing that matters to them is money . It’s know wonder they are in trouble…what goes around comes around eventually! Hail another example of bad karma coming around and biting them in the ass…

  3. MincrimeII says:

    Mikal…………maybe you where just a bad employee. And you being fired is your bad karma.

  4. Itoldyaso.... says:

    So the end is now! LNT is finished as of Jan. 1. Somehow I told you so doesn’t quite tell the entire story. For those employees that listened to the tall tells of management saying the company would survive, I suggest you learn from this for the future.

  5. Michael says:

    Even on Cyber Monday, the biggest shopping day of the year online, LNT.COM REFUSED to accept my valid LNT gift card for payment during checkout. I found this outrageous considering there are no “land-based stores” in my area to use it. I contacted LNT.COM customer service and the representative just reiterated what I already found out at checkout. However, she provided me with a phone number and address to contact corporate HQ in NJ to complain. Even during the Christmas season LNT.COM will NOT let you use your valid LNT gift card online for payment. Ironically, LNT.COM had a place to “check” your gift card balance! Too bad you can’t spend the money online!

    • abigail says:

      I read all stuff.I am so sorry about employee of lnt. But I need to asked If we change situation Will they forget their gift card or money situation and keep thinking employee.I have gift cards from lnt. And still if anyone can say I am employee of lnt and I can still do something gift cards I will send them as a free.

  6. Anonymous says:

    I have a gift card that’s worth a$100 and can’t use it…….

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