Three Borders gift card holders who wanted to be certified for a class action suit for unused gift cards at the bankrupt retailer lost their bid in U.S. District Court for the Southern District of New York. Yesterday Judge Andrew L. Carter, Jr. upheld Bankruptcy Court Judge Martin Glenn’s denial.
At the time of the final Borders store closings in September 2011, Borders had approximately 17.7 million outstanding gift cards with unredeemed balances of $210.5 million. Not a single claim was filed by card holders by the June 1, 2011 deadline for nongovernmental creditors. Ironically two of the card holders in the suit filed claims for unredeemed balances on their gift cards on January 4, 2012, two weeks after the Bankruptcy Court confirmed Borders’s Distribution Plan.
According to court documents, to date the BGI Creditors’ Liquidating Trust has distributed $80 million for administrative expenses, to priority claim holders and general unsecured creditors. There is approximately $61 million remaining for distribution.