Gift Card to Permanently Closed Business

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DTalos
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Gift Card to Permanently Closed Business

Post by DTalos »

I have a gift card to a company that permanently closed all of its locations. I have learned that the company is in bankruptcy court and filing a claim with the court is the only way to recover any money as an unsecured creditor for an otherwise worthless gift card.

What is the possibility of recovering any $ from filing a claim?
Jags4186
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Re: Gift Card to Permanently Closed Business

Post by Jags4186 »

DTalos wrote: Fri Apr 09, 2021 11:53 am I have a gift card to a company that permanently closed all of its locations. I have learned that the company is in bankruptcy court and filing a claim with the court is the only way to recover any money as an unsecured creditor for an otherwise worthless gift card.

What is the possibility of recovering any $ from filing a claim?
Likely zero chance of recovering any money. Your best bet is another company purchases the bankrupt company and honors the gift card.
z91
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Re: Gift Card to Permanently Closed Business

Post by z91 »

Somewhere between zero and nil.
boglegirl
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Re: Gift Card to Permanently Closed Business

Post by boglegirl »

Another reason to dislike gift cards :( Your best option is if you purchased via credit card, you can ask about a chargeback.

When COVID first hit last year, I read articles advising us to help our favorite restaurants and shops (which were closed in CA at the time) stay in business by purchasing gift cards. I had compassion for the small business owners who were shuttered by the lockdowns, but I was not about to give them real $ in exchange for fake $ (a gift card) that may or may not be redeemable at a future time.
Topic Author
DTalos
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Re: Gift Card to Permanently Closed Business

Post by DTalos »

Thanks for the unfortunate information.
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lthenderson
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Re: Gift Card to Permanently Closed Business

Post by lthenderson »

DTalos wrote: Fri Apr 09, 2021 11:53 am What is the possibility of recovering any $ from filing a claim?
I've had this happen a few times in the past. Mostly I got nothing. A couple times the new owner of the business gave me either partial or full credit.
Topic Author
DTalos
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Re: Gift Card to Permanently Closed Business

Post by DTalos »

A lot of consumers were probably left with worthless gift cards after many companies filed for bankruptcy during the pandemic.
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Re: Gift Card to Permanently Closed Business

Post by minesweep »

It happened to me 3 years ago when the former mall department store chain went into bankruptcy. When I stopped in the store to use the gift card I was told that it was no longer valid. The gift card was only $25 so I didn't make an issue of it. The location is currently in the process of being renovated as a grocery store.
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Paul78
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Re: Gift Card to Permanently Closed Business

Post by Paul78 »

boglegirl wrote: Fri Apr 09, 2021 1:20 pm Another reason to dislike gift cards :( Your best option is if you purchased via credit card, you can ask about a chargeback.

When COVID first hit last year, I read articles advising us to help our favorite restaurants and shops (which were closed in CA at the time) stay in business by purchasing gift cards. I had compassion for the small business owners who were shuttered by the lockdowns, but I was not about to give them real $ in exchange for fake $ (a gift card) that may or may not be redeemable at a future time.
Yeah for the most part I avoid getting gift cards. If I wanted to support restaurant just bought take out food from them. One exception was the double discount though. A local restaurant sells their gift card for 20% off at Costco and that same restaurant was had a 20% off sale (during the peak of COVID so they were really worried about business). So basically $120 of food only cost $80. I literally asked them how they could possibly make any money with a 33% discount. About a week later they temporarily pulled their gift cards from Costco and then restocked them once the 20% off promo at the restaurant stopped. I am sure I was not the only one taking advantage of it but I am pretty sure when you factor in all things (rent/staff/food/insurance/ect) they lost money on the food I bought with a 33% discount.
sport
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Re: Gift Card to Permanently Closed Business

Post by sport »

Paul78 wrote: Mon Apr 12, 2021 2:51 pm I am sure I was not the only one taking advantage of it but I am pretty sure when you factor in all things (rent/staff/food/insurance/ect) they lost money on the food I bought with a 33% discount.
OTOH, some gift cards never get used or are only partially used. The unspent portion of the cards is "free money" for the issuer.
Paul78
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Re: Gift Card to Permanently Closed Business

Post by Paul78 »

sport wrote: Mon Apr 12, 2021 2:56 pm
Paul78 wrote: Mon Apr 12, 2021 2:51 pm I am sure I was not the only one taking advantage of it but I am pretty sure when you factor in all things (rent/staff/food/insurance/ect) they lost money on the food I bought with a 33% discount.
OTOH, some gift cards never get used or are only partially used. The unspent portion of the cards is "free money" for the issuer.
Well yes big picture wise gift cards are a huge money maker for a business. People can spend them years later (decreases purchasing power cause of inflation), never spend them, over spend (get a $20 gift card an then make a $200 purchase they won't have otherwise made), become a long time costumer after being introduced to a place from a gift card they were given. Heck even worse case for the business (ie a gift card is use the same exact day it is purchased) they business still wins. Which is obviously why they frequently go on sale for less then face value. But in this particular case they had to be losing money.
bberris
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Re: Gift Card to Permanently Closed Business

Post by bberris »

I still have one of those 6 car wash cards. I bought the card, got one wash, and then the gas station changed hands a week later.
helloeveryone
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Re: Gift Card to Permanently Closed Business

Post by helloeveryone »

Paul78 wrote: Mon Apr 12, 2021 2:51 pm
boglegirl wrote: Fri Apr 09, 2021 1:20 pm Another reason to dislike gift cards :( Your best option is if you purchased via credit card, you can ask about a chargeback.

When COVID first hit last year, I read articles advising us to help our favorite restaurants and shops (which were closed in CA at the time) stay in business by purchasing gift cards. I had compassion for the small business owners who were shuttered by the lockdowns, but I was not about to give them real $ in exchange for fake $ (a gift card) that may or may not be redeemable at a future time.
Yeah for the most part I avoid getting gift cards. If I wanted to support restaurant just bought take out food from them. One exception was the double discount though. A local restaurant sells their gift card for 20% off at Costco and that same restaurant was had a 20% off sale (during the peak of COVID so they were really worried about business). So basically $120 of food only cost $80. I literally asked them how they could possibly make any money with a 33% discount. About a week later they temporarily pulled their gift cards from Costco and then restocked them once the 20% off promo at the restaurant stopped. I am sure I was not the only one taking advantage of it but I am pretty sure when you factor in all things (rent/staff/food/insurance/ect) they lost money on the food I bought with a 33% discount.
I love the costco gift cards. Tricky thing is they only allow you to use one gift card at a time (we like the ones to Ruth Chris) which "forces" two high priced meals. Having said that - when you ask the waiter nicely sometimes they let you use two gift cards in one sitting.
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JoeRetire
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Re: Gift Card to Permanently Closed Business

Post by JoeRetire »

DTalos wrote: Fri Apr 09, 2021 11:53 am What is the possibility of recovering any $ from filing a claim?
None.

How much was the card worth?

If the business comes out of bankruptcy or brings in a new owner, you could appeal to them. Don't expect anything to come of that, though.
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shunkman
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Re: Gift Card to Permanently Closed Business

Post by shunkman »

A family member gave us a gift card recently for a restaurant that we would never go to otherwise. We had an okay meal but then when we tried to pay for the meal with the gift card we were told that there was no money on it. Just another reason that I dislike gift cards.
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Bogle7
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Gift Cards can be risky

Post by Bogle7 »

boglegirl wrote: Fri Apr 09, 2021 1:20 pmWhen COVID first hit last year, I read articles advising us to help our favorite restaurants ... stay in business by purchasing gift cards. I had compassion for the small business owners who were shuttered by the lockdowns
I bought $500 worth of gift cards (and 2 lifetime beer club memberships for $200) at my local pizza and beer emporium last March because I wanted them to stay in business. Well, they are excellent business people and have thrived during the last year.
We have plans for a micro-neighborhood party there in the Fall. We will be buying.

Why not use government cheese to buy pizza futures?
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Paul78
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Re: Gift Card to Permanently Closed Business

Post by Paul78 »

helloeveryone wrote: Mon Apr 12, 2021 4:25 pm

I love the costco gift cards. Tricky thing is they only allow you to use one gift card at a time (we like the ones to Ruth Chris) which "forces" two high priced meals. Having said that - when you ask the waiter nicely sometimes they let you use two gift cards in one sitting.
Obviously it depends on the restaurant but to me it seems like they should at least let you use two gifts cards. One is being kinda cheep and low class on their part. They should be confident in their food/service (ie that will encourage you to come back) and not force you to come back because you didn't get to use all your gift cards. I mean heck one time I used 5 gift cards at a restaurant on one order.
SrGrumpy
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Re: Gift Cards can be risky

Post by SrGrumpy »

Bogle7 wrote: Mon Apr 12, 2021 4:46 pm I bought $500 worth of gift cards (and 2 lifetime beer club memberships for $200) at my local pizza and beer emporium last March because I wanted them to stay in business.
I thought this story was going to go in a different direction. Phew!
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crinkles2
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Re: Gift Card to Permanently Closed Business

Post by crinkles2 »

Similar but different story - I left a company after 11 years service for greener pastures.

I got a $100 gift card :confused

When I tried to use it, it had been expired for 2 years :sharebeer
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