Entertainment to Vendors: Honor Your Coupons, Or Else

(4/23 Update: “Sold! Entertainment Coupon Book is Back From Bankruptcy”)

Since Entertainment Publications filed for bankruptcy last month, it’s been assumed – though never really confirmed – that the coupons in the books would still be honored. Now, the bankruptcy trustee is making it official, telling companies that they’d better honor their coupons – or else.

As reported here last week (read: “Entertainment Coupon Book: Back From the Dead”), the company has resumed operations and brought back employees, pending a sale to new ownership. In a letter to company executives, the counsel for bankruptcy trustee Charles Forman says unequivocally that businesses must honor the terms of their contracts, which they entered into when providing coupons for the Entertainment Coupon Books. “All contracts remain in full force and effect,” writes attorney Kim Lynch. “No merchant, vendor or client may terminate any contract absent approval of the United States Bankruptcy Court.” Any move to back out of an existing contract would be considered a violation of the Bankruptcy Code, and “may subject the vendor or merchant to damages.”

The bankruptcy court judge last week authorized Forman to reopen the company, while preparing to sell it. Lowell Potiker, the son of the company’s founders, has made an $11.3 million offer, and is actually working alongside Forman to operate the company for the time being. Lynch notes, though, that “several other parties have also expressed an interest” in acquiring the company. A sale is expected to occur on or about April 22. All interested parties have expressed an interest in keeping the company going.

In the meantime, the company has announced that its website, Entertainment.com, is working again. Shipping of book orders that had been in limbo, will now resume, and customers can place new orders online. The company says it’s also resuming fundraising programs and delivering books to participating organizations. For now, at least, its phone number still appears to be inactive, as do its social media accounts. But, echoing Lynch’s confirmation, the company assures customers that “our merchant redemption guarantee remains in effect.”

Bottom line then, if you have a coupon book, go ahead and use the coupons. If any merchant tries to refuse them, you can just let Entertainment know, since they’re back in business and backing up their coupons – and can sic their lawyers on anyone who dares to tell you otherwise.

(4/23 Update: “Sold! Entertainment Coupon Book is Back From Bankruptcy”)