Bankruptcy Judge OKs Clothestime Bid to Close 137 Stores

U.S. Bankruptcy Court Judge John J. Wilson on Friday approved Clothestime Inc.’s plan to close 137 Clothestime and Lingerie Time stores, including nine of its 25 locations in Orange County.

Wilson also cleared the way for a massive store closing sale to begin immediately. As much as $18 million in women’s apparel is to be sold before the stores close on Jan. 31. Clothestime hired Great American Group, a Los Angeles-based liquidation firm, to handle the sale.

Clothestime sought protection under bankruptcy laws on Dec. 8 after losing $18 million in the past two years. The store-closing plan and sale are designed to help restore the Anaheim-based company to profitability.

Clothestime also reached agreement with Wells Fargo Bank, one of its largest single creditors, over certain assets that the two had been feuding over.

Lawyers for Clothestime are due back in Wilson’s courtroom on Tuesday to discuss further details of the company’s restructuring plan.