So Starbucks wants to close down some underperforming stores and a judge has blocked them? How is it a judge can?ÿdo this and what's the odds on that judge having any idea of how a business operates?
How can a darned judge force a company that is loosing money to stay open and loose more money....I don't get it. I'm sure they have a whole lot of money from selling those 50 cent coffees for $5 but still this?ÿseems?ÿout of bounds.?ÿ
The next likely step is for?ÿthe Starbucks Tea Stores to just declare bankruptcy.?ÿ?ÿ
?ÿAbout halfway down the story.
http://money.cnn.com/2017/12/12/news/companies/mall-closing/index.html
There's not much detail in that story regarding the Teavana closing or the legal action.?ÿ I would guess it's more likely Simon's suite was associated with Teavana breaking their leases as opposed to forcing them to remain in operation.?ÿ I haven't researched the topic but, as you,?ÿwould also be surprised if a court would try to force a failing retailer to remain?ÿopen despite the operator's wish to close.
Starbucks was trying to get out of leases they signed...some run for another ten years.?ÿ Generally a court will allow a failing company to break leases, but Starbucks was looking at losing about 30 million a year on these stores out of their 2.7 billion annual net income.?ÿ The judge ruled that allowing the contract to be severed would be inequitable because it placed a much larger burden on the mall owner than Starbucks.?ÿ ?ÿ ?ÿ
You can close all the stores that you want, so long as the leases are paid!
