by DETROIT — Gary Van Elslander, a son of the late Art Van Elslander, responded to a lawsuit filed this week by the trustee in Art Van Furniture Chapter 7 bankruptcy proceeding that seeks to recover more than $105 million in alleged “fraudulent transfers” from the family and other parties.
In short, he called the allegations ludicrous and said the trustee is looking in the wrong place for culpability. He should, instead, be looking to people who acquired Art Van in 2017.
“I’ve looked at the complaint, and the facts as they are presented are really incomplete, and the intent described is totally wrong and completely mischaracterized,” he told Home News Now.
“Art Van Furniture was my father’s baby. In fact, in the family, we used to laugh and say it was his 11th child, and none of us had the nerve to ask him who was his favorite.
“This was his legacy. He loved the business and he loved the employees. To suggest we were involved in any way in this deal structure is not only ludicrous but honestly, it’s insulting. They’re looking in the wrong place for culpability.”
Asked where the court should be looking, Van Elslander said, “To the people who bought the business,” back in 2017 adding, “We weren’t involved in the financing.”
That buyer would be private equity firm Thomas H. Lee Partners. Neither the trustee nor Van Elslander named THL as the buyer, but it is. At least, that’s the buyer that was named when the deal was announced in January 2017.
The lawsuit, filed March 7 by liquidation trustee Alfred Giuliano, said Art Van Furniture operated as a successful, profitable company for more than 50 years, but that changed following the sale. The transaction, it said, was highly leveraged, something accomplished by “stripping the value out of the debtors’ owned real estate properties and saddling the debtors with an unsustainable debt load for the benefit of the defendants and to the detriment of the debtors and their creditors.”
The Van Elslanders aren’t denying the years of success and abrupt downfall, only who is responsible.
Here’s the full written initial response from the Van Elslander family:
“Make no mistake, the bankruptcy proceedings may be labeled “Art Van,” but this is about the consequences of business decisions made by the company that purchased our family business in 2017.
“When company founder Art Van Elsander — our father, grandfather and great-grandfather — sold Art Van Furniture as a thriving family business, the company was generating cash, debt-free. We were promised by the buyer that the decades of commitment to employees and communities would continue as strong as ever. Those promises were broken.
“Throughout its history, Art Van’s priorities included paying its suppliers and employees on-time, in full. It has been painful to hear the stories of employees losing their jobs and creditors not getting paid, sullying our family’s good name. That is why we bought the Art Van name last year — to keep it out of the hands of those who could inflict further damage to the reputation built over 58 years of business. Importantly, all the family owns now is the name. We have no ownership of what happened to the business after the sale on March 1, 2017.
“The U.S. Bankruptcy Trustee’s efforts to force our family into court to somehow play a role in solving problems caused by the buyer of our business, specifically in the years following the sale, is an unfair attempt to shift losses to us, that we will fight in court.”
And with that, Gary Van Elslander told HNN, “It’s adding insult to the emotional injury we already suffered as the result of my father’s business going bankrupt.”
The government does not care who they go after. They are tossing a large net to see who they can find with money. It is sad that this great family name gets run through the wringer over a bunch of lousy attorneys in the bankruptcy court. They ran a successful business for decades. They offered it for sale. They sold it. Their hands are washed of the matter.