March 9, 2010 in Business

Sale looms for Spokane Harley Davidson dealership

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A bankruptcy judge in Spokane next week is expected to set a date for selling Spokane’s only Harley Davidson dealership, plus three more stores in Walla Walla, the Tri-Cities and Lewiston.

John Michial Shumate and his wife, Jennifer Shumate, filed for bankruptcy last fall. In documents the Tri-Cities couple say they’ve racked up than $10 million of debt.

Their first motorcycle shop, in Kennewick, was a Harley Davidson and Buell dealership.

In 2004 the couple took over Spokane’s sole Harley Davidson dealership, at 6815 E. Trent Ave.

Before the recession crippled consumer spending, the couple made plans to open a second north Spokane dealership. When they declared bankruptcy the Shumates closed all their stores.

Davidson filed the Chapter 11 cases after creditors sued the Shumates in state court.

The judge in the Spokane district of U.S. Bankruptcy Court likely will set a sale date before the end of March, Davidson said.

It’s unclear how simple the sale will be. The bankruptcy includes 11 secured creditors lined up for proceeds, said Barry Davidson, a Spokane attorney representing the Shumates.

Also, there are numerous unsecured, lower-tier creditors in the case, Davidson said.

The sale will include all company assets and the dealerships in Spokane, Lewiston and Walla Walla, except for the Tri-Cities store. That store will be kept but leased to the eventual buyer, Davidson said.

A Phoenix company, Ride Now Powersports, has made an offer to buy those assets. At the same time, the Shumates are allowing other bidders to make higher offers for the assets, Davidson said.

The exact amount owed by the Shumates is uncertain, due to a morass of business entities and creditors, including the Washington Department of Revenue, which has filed for unpaid state taxes.

Davidson said he expects a judge to set the sale timeline and process next week. The judge will review motions by attorneys for Harley Davidson insisting that prospective buyers have liquidity, adequate insurance and dealership experience, among other things.

Seven comments on this story so far. Add yours!

• 

  PhiltheBibliophil on March 09 at 6:33 p.m.

  Just another example of The America any of us knew will never be the same again! Some will say that's good. But since we are still a consuming, non-producing nation GDP depended on these kinds of purchases! Now with businesses that are managing to survive cutting wages, hours and benefits it is only going to get worse! No more Boats, RV's, 2nd Homes, Jewelry Stores, Snowmobiles, ATV's, etc. This might be labeled a Recession, but its going to be a Depression of Biblical porportion! The only ones who will be able to afford any “Bling” will be the Corporatocracy Elite!

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  misjustice on March 09 at 6:53 p.m.

  The Corpocracy Elite is Gawds will! AMEN….

• 

  CharlesBillford on March 09 at 7:47 p.m.

  There were just too many dealers, especially over in CDA that could beat their prices.

  So what happened to the inventory?

  Harleys cost a lot out of the showroom but drop in price like a hot potatoe. $12K Harleys are now $4K used Harleys a year later, plus they haven't stayed on top of the technical edge like their competitors.

• 

  Spokane_Citizen on March 09 at 7:54 p.m.

  That's just silly talk. A $12K Harley doesn't become a $4K Harley in a year. And there is only one dealer in CDA.

• 

  Mr_Bloggy on March 10 at 5:57 a.m.

  I hope I can survive this bad news.

  Survive the very thought of a summer in which I have to watch out for fewer senior citizens tooling about on massive noisy Harleys, their long dessicated gray pony tails swinging in the wind, their arthritic, knobby fingers barely hanging onto to the handlebars, their rheumy eyes squinting to make out the traffic light ahead, their glacial hand-eye reflexes about to cause them to jump the curb and crash through a street harmonica player and his adoring two fans, resulting in yet another senseless, tragic Spokane story of menace and mayhem.

  Yes, a summer with less Harleys is a summer for which I can only drop to my knees and thank the Gods of Recession for severely depressed consumer spending within the senior citizen segment.

• 

  CharlesBillford on March 10 at 8:50 p.m.

  I guess Spokane Citizen doesn't read Craigslist.

• 

  diablo on March 23 at 7:57 p.m.

  Mr Bloggy reading your comment makes it look like you have been wishing for along time that you would have been allowed to get that bike, you sound like you missed out on the fun, thats too bad