hhgregg, committee seek court approval of Synchrony claim settlement

By Caroline Salls

Pittsburgh, Nov. 28 – hhgregg, Inc. and its official committee of unsecured creditors requested court approval of a claims settlement reached with Synchrony Bank, according to a motion filed with the U.S. Bankruptcy Court for the Southern District of Indiana.

Before its bankruptcy filing, hhgregg said debtor Gregg Appliances, Inc. and Synchrony were parties to a private-label consumer credit card program agreement.

On July 3, Synchrony filed a motion to recoup or offset claims and for payment of administrative expenses, seeking to set off amounts owed by the debtors against amounts owed by Synchrony arising out of the contract and seeking payment of additional amounts alleged to be owed to Synchrony for post-bankruptcy transactions arising out of the contract.

Specifically, Synchrony alleged it has a claim of at least $13.51 million, part of which is entitled to administrative expense priority.

Under the proposed settlement, the hhgregg debtors will pay Synchrony $73,603 on the first business day after entry of the settlement order, representing customer payments paid to the hhgregg debtors but intended for Synchrony.

In addition, Synchrony will have a $1.93 million administrative expense claim against the hhgregg debtors.

Synchrony will also be authorized to apply specified credits, letter-of-credit amounts and proceeds to the portion of its claim that is not allowed as an administrative-expense claim.

After the application of those amounts, Synchrony will have an unsecured, non-priority and non-administrative-expense claim in the amount of $7.5 million.

hhgregg is an Indianapolis-based specialty retailer of consumer electronics and home appliances. The company filed for bankruptcy on March 6, 2017 under Chapter 11 case number 17-01302.

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