Following legal issues and filings that have been chronicled here at “lightED” for most of 2022, lighting distributor Atlanta Light Bulbs has gone out of business. Companies and banks seeking payment from the distributor now believe they will not receive much, if anything, in return.
As “lightED” reported last June, Halco Lighting Technologies, Candela Corporation, and Norcross Electric Supply filed an involuntary bankruptcy petition against Atlanta Light Bulbs. Halco alone claims it is owed more than $300,000. The three organizations worked together on its lawsuit to try and collect past money owed. They filed a legal document to be named “The Official Committee of Unsecured Creditors of Atlanta Light Bulbs” or “The Committee”.
Tandem Bank filed a separate bankruptcy claim against Atlanta Light Bulbs, claiming it gave the distributor a $600,000 loan in September of 2020, which due to interest and penalties, grew to more than $650,000. Tandem believes it should receive any payment from the bankruptcy before The Committee. In filings to present their cases to a bankruptcy judge, both The Committee and Tandem Bank leveled a number of accusations at Atlanta Light Bulbs. The allegations included owner Jessica Mendoza embezzling funds for personal reasons.
“…improper transfers of funds from the Debtor to insiders in the past approximately one-and-one-half years totaling in excess of $1.8 million. Specifically, of the $1.8 million that was transferred to insiders during that time period, nearly $600,000 went to Ms. Mendoza and another more than $1.2 million went to her boyfriend, Robert Taitz. It is noteworthy that, on information and belief, Ms. Mendoza never received anywhere near $600,000 in compensation for her role at the company since she acquired her shares and began working at the business. Further, the more than $1.2 million that was transferred to her boyfriend was not, on information and belief, earned compensation or payments in satisfaction of any debt owed by the Debtor to Mr. Taitz. As such, these payments would appear to be fraudulent transfers that are subject to avoidance and recoverable for the benefit of the estate and its creditors.”
In an additional filing, Ford Motor Credit claims Atlanta Light Bulbs owes $459,433 on seven Atlanta Light Bulb vehicles. Ford Motor Credit Company asked the court for permission to take possession of the vehicles during the bankruptcy case.
“The Committee” believed Atlanta Light Bulbs could remain a viable business and be able to pay its debts through reorganization.
But, as of last month, Atlanta Light Bulbs is no longer doing business. Its website, which billed itself as a “premier lighting source in metropolitan Atlanta, and nationwide through its expansion to AtlantaLightBulbs.com in 1998, providing a huge selection of the most in-demand LED light bulbs, ballasts, smart lighting technologies and accessories,” has been replaced with a message that says “Down for Maintenance. Currently Unavailable”.
The company’s LinkedIn page is more definitive, with a message that says “closed permanently”.
Creditors believe that with the line of attorneys, banks, car manufacturers, and lighting manufacturers, there are not a lot of remaining assets left to recover losses.