Arrow-right Camera


Sale looms for Spokane Harley Davidson dealership

Tue., March 9, 2010, 5:15 p.m.

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.

There are seven comments on this story »