Warning

 

Close

Confirm Action

Are you sure you wish to do this?

Confirm Cancel
Member Login
Site Notices
9/22/2017 12:11:25 AM
Posted: 2/15/2002 1:19:20 PM EDT
[b]Sorry no link.[/b] Friday, February 15, 2002 Bank robbery gun shop files bankruptcy papers By Brent Hopkins Staff Writer NORTH HOLLYWOOD -- B&B Sales, the well-known San Fernando Valley gun store that helped arm police during the 1997 North Hollywood bank robbery shootout, filed for Chapter 7 bankruptcy Thursday. Previously, the chain hoped to emerge from reorganization under Chapter 11 protection from its creditors, but was unable to turn a profit and instead elected to liquidate. "I'm shocked," said Rick Kaumeyer, a West Hills fraud investigator who has been buying firearms there for more than a decade. "They were always there for the community, and I'm sad to see them go." At its peak, B&B was one of Southern California's premier gun sellers, from its flagship North Hollywood location and a second in Westminster. Both locations closed Thursday. According to Bankruptcy Court filings, revenues topped out at $23 million during its heyday, when 50 employees staffed its two stores. At its North Hollywood location on Oxnard Street, target shooters and law enforcement personnel alike stocked up from a wide selection of handguns, rifles and shotguns. The Los Angeles Police Department became B&B's most visible consumer during the notorious North Hollywood shootout, when cops borrowed high-powered semiautomatic rifles and shotguns from the dealer to do battle with body-armored bank robbers who had superior firepower. B&B later auctioned off the guns and donated proceeds to the LAPD Memorial Fund. But while the company remained a high-profile dealer, its finances were in turmoil. In 1993, relations between its founders, brothers Bob and Barry Kahn, soured. This led to litigation between the two over control of the company in 1994, eventually leading to a settlement in 1997 that left the business in the hands of Bob Kahn and his wife, Kathleen. It also racked up $1.75 million in legal and accounting fees, the first cited cause of the bankruptcy.
Link Posted: 2/15/2002 1:20:30 PM EDT
According to the filing, at this time, Barry Kahn engaged in illegal activities that would have endangered B&B's licenses and which later got him locked up in federal prison. The filing further alleges that he bought substantial inventory against Bob Kahn's wishes, which then had to be liquidated at a loss for $425,000. Bad investments followed, and all the while the company found itself with increasing legal headaches. Beyond that, anti-gun legislation by the city has hurt. "Gun businesses are dropping like flies in the city of Los Angeles," said Chuck Michel, a spokesman for the California Rifle and Pistol Association and a lawyer who represented B&B in past lawsuits. "They have ridiculous taxes, ridiculous expenses and it's impossible to find employees to get their permits approved. The simple truth is that they've litigated this store to death, which is what they always wanted to do." Two of B&B's past legal difficulties are cited in the filing. A lawsuit filed by various municipalities in 1999, prosecuting various dealers and manufacturers as contributing to a public nuisance, tied up more funds in legal fees. Last March, agents from the California Department of Justice raided both of B&B's facilities, alleging that the dealer had defrauded gun buyers. "B&B believes that these acts were a blatant, premeditated and orchestrated attempt to destroy B&B," the filing reads. Hallye Jordan, a spokeswoman for the Justice Department, disputed this, saying the department had turned up numerous complaints that the firm had charged buyers for personal transfers of firearms, a transaction that should be free. "We got some complaints from consumers that they were being charged these fees, then we did some sting operations where our agents were overcharged, as well," Jordan said. "We talked to the owners and advised them that was illegal. They were warned, which is what led to the search warrants being served." All these factors led the company to file for Chapter 11 protection last August, attorney Jeffrey Shinbrot said, when B&B sought to reorganize its finances. Things even looked up for a bit, when interest in guns rallied after Sept. 11. "After the Sept. 11 attacks, the revenues increased dramatically, which made them apparently profitable through the end of October," Shinbrot said. "However, the increase in sales diminished and the business was not profitable."
Link Posted: 2/15/2002 1:21:09 PM EDT
That's when lawyers changed their petition to Chapter 7, permitting a liquidation of the company's assets. Kahn told the Daily News last month that Assembly Bill 106, which went into effect Jan. 1 and which requires trigger locks for all guns sold in California, hurt business further. Since the devices were in short supply, his sales were severely curtailed, which Shinbrot said was a factor in the decision to liquidate. Kahn declined comment Thursday. Other local gun dealers agreed that tougher gun laws made business difficult. "I'd have to agree that they're trying to make it difficult on us, but our business has been relatively pretty good," said Gene Lumsden, vice president of operations for Turner's Outdoorsman. "I think they're running out of things to do. The only thing they can do is finally say we just don't want you to own guns anymore, and then people will know what their true agenda is." Sam Rosenfeld, store manager of Collateral Loans Inc., a pawn shop in Reseda, agreed. "You would not believe the various and sundry taxes and fees, surcharges and licenses -- they call them all kinds of different names," he said. "What they're trying to do is tax us out of the business." But according to Stuart Adler, assistant manager of The Firing Line, a gun shop and firing range in Northridge, the laws don't restrict business to impossible levels. "It's a lot of pain, but we're seeing a good rate of gun sales," he said. "People resent the fact they need to buy a lock, but a good salesman's a good salesman. I'm a conservative, but I don't think anything will happen. It's difficult, but I think that the laws are OK. Some of them just aren't implemented well."
Link Posted: 2/15/2002 1:39:05 PM EDT
Link Posted: 2/15/2002 1:45:07 PM EDT
Originally Posted By Lumpy223:
Hallye Jordan, a spokeswoman for the Justice Department, disputed this, saying the department had turned up numerous complaints that the firm had charged buyers for personal transfers of firearms, a transaction that should be free.
View Quote
Umm.......Did this jump out at anybody else?
View Quote
No is there some law requiring gun shops to fill out ownership transfer papers for free?
Link Posted: 2/15/2002 1:49:37 PM EDT
It's sad to see them go. I know some of you here had bad experiences with them, but I had fond memories with the Westminster shop and some of the people working there. I think bad management and infighting have more to do with B&B's demise than the laws themselves. Otherwise, Goldcoast, Turners and Arm USA would have gone down, too. It sucks more that I am still waiting for the check for my consignment...[:(]
Link Posted: 2/15/2002 1:56:16 PM EDT
"It's a lot of pain, but we're seeing a good rate of gun sales," he said. "People resent the fact they need to buy a lock, but a good salesman's a good salesman. I'm a conservative, but I don't think anything will happen. It's difficult, but I think that the laws are OK. Some of them just aren't implemented well."
View Quote
If I lived in Northridge, I would not be buying guns from this guy.
Top Top