Hartmarx, the luxury clothes designer, seeks protection in bankruptcy court

The Chicago-based apparel company that has produced suits for President Obama and in January filed for bankruptcy is scheduled to return to federal court tomorrow.

Hartmarx, with plants in Des Plaines and Rock Island, has cited the economic downturn, more casual dress in the work place and the consolidation of retailers as major factors that led them to seek bankruptcy protection. Details of tomorrow's hearing were not immediately available and Hartmarx representatives did not immediately return requests for comment.

The corporate headquarters is at 101. N. Wacker Drive.

Established in 1872 by two German immigrant brothers, the suit maker signed a landmark collective bargaining agreement in 1911 after a walkout by one of its workers prompted thousands of other garment workers to go on strike. The strike also led to the formation of the Amalgamated Clothing Workers of America which has since become part of UNITE HERE. 

Calls to UNITE HERE for comment today were also not returned. 

According to the company's bankruptcy filings, Hartmarx currently employs about 2,000 hourly and 650 salaried employees. It is unclear how the company's current financial situation will affect its local workforce, but Homi Patel, Hartmarx chief executive officer, has said in a statement that "we will continue to be committed to our employees, suppliers, and customers."

The bankruptcy documents also disclosed that Hartmarx ran a program through which it enlisted students at "certain elite business schools" to sell their garments and other apparel to other business students.  Hartmarx owed these students approximately $55,000 for their services as of Jan. 23, when it filed for protection.

And at least two Mexican clothing companies have filed motions to ensure they are paid for work and materials they provided for one of Hartmarx's 50 subsidiaries.

Chicago attorney Oliver Larson filed motions today on behalf of Trajes Mexicanos seeking $95,000 for goods delivered to Buffalo-based M. Wile Company before the bankruptcy filing. "We just want to make sure we get paid," he says.

Discuss

KEENAN O, 05-06-2009

Bankruptcy is now a trend to most of huge companies especially in electronics, auto-industry and even on clothing lines. Unlike Hartmarx, Chrysler bankruptcy has been subject of debate and rumor for months, but it isn't speculative anymore. A Chrysler bankruptcy is now inevitable, and more to the point, they have already filed. The Chrysler bailout, several billion dollars worth, wasn't enough debt relief, so they have filed for Chapter 11 bankruptcy, as they couldn't get cash advance loans large enough to stop it. The government, now a primary stakeholder, has urged a prearranged bankruptcy, so that the filing is short lived and the company reemerges as a leaner, meaner animal ready to compete in the market. The Chrysler bankruptcy, while unpleasant, might provide them with the debt consolidation they need.