Circuit City Files for Chapter 11 Bankruptcy

By Joe Haygood | November 10, 2008

After a struggle with sales, a plummeting stock price and vendors stopping shipments of goods, Circuit City had few options left, and filed for Chapter 11 Bankruptcy protection in Federal Court today.  The Canadian operations of Circuit City filed for similar protection in Canadian courts today as well.

Circuit City had recently announced a plan to close 25% of its stores in an effort to stave off the bankruptcy filing, but with the share price at 11 cents a share, and a delisting notice from the New York Stock Exchange, it had few options left.  Some of its biggest creditors include HP, Sony, Samsung and Toshiba to name a few.

WIth the Chapter 11 filing, Circuit City can continue operations without the fear of losing shipments or goods due to an inability to play the bills.  The board of directors has stated that the company will continue doing business through the Christmas season as it tries to negotiate repayment plans for its creditors.  However, competition from Best Buy, Walmart, Target and other regional chains have chiseled away at the once mighty electronics retailer, leaving some to wonder if the store will still be around come January or February.

via MSNBC