Gilroy
– A longtime downtown clothier filed for bankruptcy protection
Friday, four days after closing its doors to the public following a
57-year run.
Gilroy – A longtime downtown clothier filed for bankruptcy protection Friday, four days after closing its doors to the public following a 57-year run.
Dick Bruhn Inc. left a trail of $11.3 million in debt and hundreds of creditors who invested money in the stores founded by Salinas resident Richard L. Bruhn, according to its Chapter 11 bankruptcy filing and a letter to investors. Bruhn’s stores in Gilroy, Hollister, Monterey and Salinas closed April 30, though they plan to re-open May 18 for a summer liquidation sale. Proceeds are expected to net roughly $7 million, according to bankruptcy filings.
“We just don’t know until everything gets bought and processed what will be there,” said William Lewis, a Palo Alto attorney representing the company in bankruptcy court. “You just don’t know. You could end up with significantly more or significantly less … Our goal here is to maximize the return to creditors. The whole process is intended for that purpose.”
Richard L. Bruhn is a long-time fixture in Salinas society with close relationships to many of the city’s wealthier families, according to Lynne Pickett, 71.
Pickett inherited investments her mother made in Bruhn’s corporation and is still owed nearly $26,000. She is one of at least 400 creditors of the company.
“You’re going to find a lot of old gray-haired ladies” waiting for money, said Pickett, who now lives in Arizona but still has a home in Salinas.
Dick Bruhn opened his Gilroy store in 1950 at 7541 Monterey St. A women’s section, known as M’Lady Bruhn, opened in the late ’70s. The store reached its heyday in the 1980s, when the downtown was still Gilroy’s commercial center. Even as the area declined with the opening of the Gilroy Premium Outlets and the big-box stores in east Gilroy, Bruhn managed to attract a faithful customer base with its focus on personalized service and its tuxedo business. Nearly 300 high school students rented Selix tuxedos from Bruhn each year. The company’s tuxedos and other formal wear account for the lion’s share of the company’s estimated $7 million in assets.
The fate of the former store remains unclear. Land records indicate that Bruhn, along with John O. Maness and Alex Shirokow, transferred title to the store and two neighboring properties in 1982 to Gilroy Investment Company.
The U.S. Bankruptcy Court of the Northern District of California, in San Jose, is expected to decide Thursday if the company can proceed with its summer liquidation sale.
