Great American Group LLC and Hudson Capital Group LLC

Washington, DC: (Jul-13-07) Now defunct music retailer Tower Records filed lawsuits against two of its liquidators, Great American Group LLC and Hudson Capital Group LLC, over going out of business sales conducted at its stores in 2006. The settlement resolves a dispute between the parties regarding how much money Tower Records should have received after the two companies, Great American Group LLC and Hudson Capital Group LLC, conducted the sales. Great American and Hudson initially agreed to pay Tower Records 45% of the retail price of the merchandise sold. But a quarrel erupted with Tower Records over how the retail price of the merchandise should be determined. Great American and Hudson argued that the retail price of the merchandise was about $221 million, which meant it would only have to pay $99.5 million to Tower Records. Tower Records argued the retail price of the merchandise was about $228 million, wherein Tower was entitled to $102.6 million from Great American and Hudson.

In a settlement reached, a joint venture of Great American and Hudson agreed to hand over $2 million to Tower Records' bankruptcy estate to settle the dispute. They also agreed to pay an additional $1.1 million to resolve another dispute regarding expenses incurred while the sales were being conducted. [FORBES: TOWER RECORDS LIQUIDATION]

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Published on Jul-16-07