Bankruptcy Takes A Personal Toll On Retailer A family-owned chain of New England housewares stores has filed for bankruptcy protection. But the battle to keep up with the court's requirements and to prove that he's running a viable business is rough on Bowl & Board owner Mark Giarrusso.
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Bankruptcy Takes A Personal Toll On Retailer

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Bankruptcy Takes A Personal Toll On Retailer

Bankruptcy Takes A Personal Toll On Retailer

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From NPR News, this is ALL THINGS CONSIDERED. I'm Michele Norris.


And I'm Melissa Block.

For the past few months, NPR has been chronicling one small business' struggle to survive the down economy. Last month, Bowl and Board, a Massachusetts based housewares chain filed for Chapter 11 bankruptcy protection. Today, NPR's Tovia Smith checks back to see how the business is doing.

TOVIA SMITH: As Mark Giarrusso will tell you, there are plenty of really hard things about being in bankruptcy. One is just believing it.

Mr. MARK GIARRUSSO (Bowl and Board Owner): This happened so quick. I didn't see it coming.

SMITH: It's true business was bad at one of his three stores and Giarrusso had fallen behind on his rent. But he was trying to negotiate with his landlord. And he figured he was headed for some belt-tightening, not bankruptcy.

Mr. GIARRUSSO: I thought, worst-case scenario, I'd be by myself, be the old shopkeeper that comes in and does everything - that was my plan. Just hang in there.

SMITH: But when GIARRUSSO's landlord sued him for the nearly $90,000 he owed in back rent and got a court to freeze the store's bank accounts, Bowl and Board was paralyzed. Next thing he knew, Giarrusso was following his lawyers into bankruptcy court.

Mr. CHRISTOPHER PANOS (Bankruptcy Attorney): My associate calls this the death march.

SMITH: Bankruptcy attorney Christopher Panos cuts through Boston traffic on the way to Giarrusso's make or break hearing with the judge.

Mr. GIARRUSSO: Just basically asking to stay in business. Let us keep going. Yeah, in these hard times, yeah. But why would you shut this down? You're going to put everyone in unemployment?

SMITH: In court, Giarrusso's attorneys argue that if the frozen funds are released, Giarrusso can save his other two stores, and the landlords would probably get enough to cover their back rent and then some. But the landlord's lawyer, Rosemary Macero, wants the judge to liquidate the business immediately.

My client was stiffed for over six months, she says. And if the judge lets Bowl and Board use the money, it'll be gone forever, because the business is going to fail. Their merchandise, she says, is nothing special. Giarrusso squirms in his seat.

Mr. GIARRUSSO: It's obnoxious. The way she spoke, nothing special, just, please.

SMITH: It lessens the sting just a little when the judge sides with Bowl and Board, ordering the money unfrozen. Giarrusso has won the first battle, but the war is far from over.

Mr. GIARRUSSO: She wants to wrap up the monthly report on Friday.

SMITH: As a debtor in position, as Bowl and Board is now called, Giarrusso and his bookkeeper, Polly Paunova, are working overtime.

Ms. POLLY PAUNOVA (Bowl and Board Bookkeeper): The operating guidelines and the reporting requirements we…

SMITH: What's that, like, 40 pages?

Ms. PAUNOVA: Yeah.

Mr. GIARRUSSO: Some of them pretty heavy stuff. I really, I haven't spent any time on the floor today. Hey, ma'am, you been helped?

Unidentified Woman #1: No.


SMITH: The extra work comes just as Giarrusso needs to make every sale he can to prove he's a viable business. To get things going, he launches a big sale.

Ms. DINAH STEWARD: I did a lot of damage, yeah.

(Soundbite of laughter)

SMITH: Dinah Steward, the songwriter, is furnishing a new home.

Ms. STEWARD: Actually is one of my favorites, this French, with the crazy chicken wire on the front.

SMITH: But even the most loyal customers won't save his business if Giarrusso can't get inventory. And three weeks after his money was frozen, and five days after the judge ordered it released, the bank has still not freed up his funds.

Mr. GIARRUSSO: They were supposed to cough it up immediately, but what am I going to do? Spend another $1,200 in legal fees to get it, like, today versus tomorrow? Cha-ching, cha-ching, cha-ching. So I backed off.


Unidentified Woman #2: I was on line two and (unintelligible) on line one.

Mr. GIARRUSSO: How can I help you?

SMITH: As vendors keep calling, Giarrusso struggles to explain when he'll be able to send them some money.

Mr. GIARRUSSO: It's hours away from being unfrozen, but it's a little bit of an unknown.

SMITH: Unable to buy, Giarrusso's inventory dwindles.

(Soundbite of phone ringing)

Mr. GIARRUSSO: Bowl and Board. If we have what? Fondue sets? We do not.

SMITH: And that hurts sales even more.

Mr. GIARRUSSO: We did 29,000 for the month of January.

Unidentified Female #3: Total?

Mr. GIARRUSSO: Yeah. She's going to shut it down.

SMITH: Giarrusso considers another sale, but he worries that may cost him in the long run.

Mr. GIARRUSSO: You know, short-term profitability is easy 'cause you can just chuck it out the door at discount rate, but I don't want to be a hero today and a loser tomorrow.

SMITH: It's now a week after the judge ordered Giarrusso's money released.

Mr. GIARRUSSO: We're constantly checking online to see if the…

Did you check (unintelligible)?

Ms. PAUNOVA: I just did while you were on the phone.

SMITH: And Giarrusso still can't pay his rent or payroll, even his cell phone has been shut off.

Mr. GIARRUSSO: I am exhausted. I've been going straight for three weeks.

SMITH: The stress is starting to take its toll.

Ms. PAUNOVA: Are you shaking?


Ms. PAUNOVA: Is that something new?

Mr. GIARRUSSO: I'm not feeling good. I mean, I had to push it this weekend.

SMITH: A six-foot, 220-pound hockey player, Giarrusso is a pretty hearty guy, but two days before he's due back in court, store clerk Sara Binns and Becky Boguzis see him crash.

Ms. SARA BINNS (Bowl and Board Clerk): He was on the phone, and he's hunched over like this, and he looked so bad.

Ms. BECKY BOGUZIS (Bowl and Board Clerk): He was dizzy. He was having trouble standing.

SMITH: When he started having trouble breathing, too, Giarrusso headed for the emergency room. Twenty-four hours later, the doctors say he's got an irregular heartbeat made worse by fatigue. He leaves the hospital and goes back to work.

Unidentified Woman #4: You're alive.

Mr. GIARRUSSO: I don't want to talk about it.

SMITH: Giarrusso comes back to a bit of good news. His money is unfrozen, and he can finally write checks. But there is little celebration. Tomorrow, Bowl and Board is due back in court, and the business' life depends on whether it hits its target.

Mr. GIARRUSSO: It's tight.

Unidentified Woman #4: We have to try.

SMITH: Tovia Smith, NPR News.

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