The dealer group, which reported 2007 sales of 40,781 new vehicles and had group revenue of over $2.1 billion, said in a statement that, “Rising fuel prices, a product portfolio of mostly heavy trucks and sport utility vehicles, economic recession, unfavorable local market conditions for vehicle sales, the crisis in the banking and financing sectors, and other factors combined to create a business environment in which the company simply did not have the resources needed to continue to operate.”
Heard Enterprises owes $40 million in unsecured debt, the filing said. Other debts also include unpaid wages and employee medical claims, the emergency motion said.
The Frost National Bank of San Antonio, Texas, was the company's largest unsecured creditor, claiming the dealership group owed it more than $1 million, plus interest. Bill Heard Enterprises also owed states at least $3.2 million in sales tax. Hendrick Automotive Group had expressed in acquiring at least some of the Bill Heard Enterprises stores. NASCAR-team owner Rick Hendrick stated “If something comes of our conversations, we certainly will announce it,” Hendrick added, “If there’s a potential opportunity to expand our company, we’re always going to be interested in discussing it.”
It was further reported that Carl Gregory Enterprises Inc., a dealership group based in Columbus, Ga., was in talks to buy Heard’s flagship store in Columbus. GM may not cooperate to reopen dealerships in all the locations. GM’s vice president of North American vehicle sales, service and marketing has said that GM is hoping to increase dealership consolidation, possibly closing up to 400 stores in 2008.
Former Employees File SuitFormer employees of Bill Heard Enterprises Inc. have filed a lawsuit against the company, claiming they did not receive notice before losing their jobs when the Heard stores closed. Two employees of the store in Huntsville, Ala., filed the suit, which seeks class action status, in the Northern Alabama U.S. District Court. They filed it Sept. 25, one day after Heard closed its 13 remaining stores.
The suit seeks to cover all employees who lost their jobs this month but did not receive notice or compensation. Under the federal Worker Adjustment and Retraining Notification Act, qualifying employees must receive 60 days’ notice before the closing of their workplace. Under WARN, a company does not have to give employees notice of their termination if it "could not reasonably foresee business circumstances” that led to the closing, according to an explanation of the law in a government brochure.
The employees seek back pay for the 60 days that Bill Heard Enterprises should have paid them after notifying the workers that the company was closing its stores. They also seek reimbursement of legal fees.