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Court Orders Circuit City to Pay $1M to DVD Distributor

9 Feb, 2009 By: Erik Gruenwedel

Circuit City

A bankruptcy court Feb. 3 ordered shuttered Circuit City Stores to pay Alliance Entertainment a lien payment of more $1 million for the warehousing and shipment of third-party DVD movies and related content to stores during the ongoing liquidation sale, according to a filing.

The Coral Springs, Fla.-based merchandising and fulfillment-company last month filed a claim with U.S. Bankruptcy Court in Richmond, Va., demanding the No. 2 consumer electronics retailer make good on a pre-payment lien in the amount of $1,028,153.34.

Circuit City, which filed for bankruptcy protection in January prior to ceasing operations, had disputed the lien amount and asked the court to force Alliance to deliver Circuit City-owned packaged-media product to its stores to accommodate an ongoing liquidation sale.

Circuit City agreed to set aside proceeds from the ongoing liquidation to pay the lien.

When it filed for bankruptcy, Circuit City owed Hollywood studios more than $56 million for outstanding Blu-ray and standard DVD product.

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