3/22/17

Sears Changes Its Tune: No, We’re Totally Not Doomed

After being refreshingly candid in its annual report, admitting that there is a lot of “doubt” about its ability to remain afloat in the long run, Sears Holdings is now doing an about-face, with its chief financial officer assigned to handle damage control. Get your “Sears Holdings Corporate Announcement Bingo card” ready.

“Sears Holdings remains focused on executing our transformation plan and will continue to take actions to help ensure our competitiveness and ability to continue to meet our financial obligations,” CFO Jason Hollar, who is not the founder of online dollar store Hollar, wrote on the SHC Speaks blog.

Between the sale of the Craftsman tool brand, the sale of Sears properties to a real estate investment trust, and more borrowing from its CEO, Sears Holdings will be able to pay its bills for another year unless something unanticipated happens, to the company or to retail in general. What happens after that?

CFO Hollar argues that the risks listed in that annual report are required by regulators and that the report didn’t include the company’s corresponding plans to mitigate those risks.

“While historical performance drives the disclosure,” he wrote, “our financial plans and forecast do not reflect the continuation of that performance.”

The problem is that we don’t see any evidence that customers are flocking to Sears and Kmart stores or to ShopYourWay.com. The things that Sears Holdings has tried to date haven’t worked, and are continuing to not work.

City Sues Star Of HGTV’s ‘Rehab Addict’ Over Un-Remodeled Home

The premise of HGTV’s Rehab Addict is simple: The show’s star, and home remodeler Nicole Curtis buys a historic home in Detroit or Minneapolis that has been ravaged by years of neglect and returns it to its former glory. But nearly five years after purchasing one Minneapolis property, the city is suing Curtis, claiming she hasn’t done the work, resulting in complaints from neighbors and piled-up bills.

The lawsuit [PDF] was filed by the city in late January, but is only coming to the public’s attention now. The complaint alleges that Curtis and her company Detroit Renovations breached their contract by failing to redevelop the property, paying real estate taxes, or maintain insurance.

According to the city, Curtis paid $2 for the home and entered into a contract with the city in 2013, in which she would redevelop the dilapidated property (seen below in a Google Maps photo taken in 2011) into a single-family dwelling.

“Specifically, [Curtis] agreed to make certain improvements to the property in substantial conformance with the construction plans submitted to and approved by the city,” the suit claims, adding that minimum improvements would be made within one month and that a substantial amount of construction would be done within 12 months.

The contract also required Curtis and her company to maintain builder’s risk insurance, commercial general liability insurance, and worker’s compensation insurance.

Under the contract, if Curtis or her company failed to meet the requirements, the city had the “right to re-enter and take possession of the property and to terminate the estate.”

The city claims in the lawsuit that after nearly three years none of the requirements have been realized.

In July 2016, the city says it sent Curtis a notice of default giving her until Sept. 30 to make required changes: making progress on construction, pay taxes, and maintain insurance.

The city says that hasn’t happened. However, Curtis’ lawyers tell the Minneapolis Star Tribune she has paid the property taxes since receiving the default notice.

Additionally, in a subsequent court filing, Curtis’ lawyers said that she was not able to make the required improvements to the home because the city and other third-parties prevented her from doing so, the Star Tribune reports.

With the lawsuit, the city is asking the court to determine that Curtis breached the contract and give it permission to re-enter and take possession of the home.

Issues on the property aren’t new, the Minneapolis Star Tribune reports.

Curtis previously told the publication that she had trouble with contractors on the site. Curtis apparently alluded to the issues in a Facebook post, claiming that she had hired one to complete work by Dec. 2014, but that deadline was continuously pushed back.

These issues allegedly led to two separate liens on the property. In all, those complaints totaled $36,000 for unpaid work.

City Pages reported in June 2015 that neighbors of the property were unhappy that process was not being made on the home.

One couple told the paper that they were excited to live next to the home, but that after two years the home still remained uninhabitable. They claim that trees and building materials remained littered around the yard, despite the fact that it had been months since any work had been performed.

“As of now the property is a liability to us and the children of the neighborhood,” the couple told City Pages at the time.

17,000 AT&T Technicians Go On Strike Amid Contract Dispute

AT&T U-Verse customers in Nevada and California might find it hard to schedule an appointment with a company technician, after an estimated 17,000 workers walked off the job today in those states amid an ongoing contract dispute.

Unionized workers who are part of the Communications Workers of America, District 9 haven’t had a contract for almost a year, reports the Los Angeles Times.

Workers walked off the job starting at 6 a.m. today, claiming they’re being asked to do the work of higher-paid employees without equal compensation: Technicians who usually install and maintain U-Verse TV service are also required to work on the cables, hardware, and other infrastructure used to provide landline phone service, the workers say.

Union members are also upset by the closure of AT&T’s U.S. call centers in favor of hiring overseas workers, and the erosion of health benefits.

“While AT&T is extremely profitable, the company has become disconnected from the day to day issues facing workers and customers,” the union said in a statement to DSLReports. “Despite the financial success, the company is asking its workers to do more for less — keeping them from their families with unpredictable overtime, undercutting pay and advancement, offshoring good jobs, and pushing more healthcare costs onto employees. At the same time, customers are paying increasingly higher bills to AT&T for essential services.”

It’s unclear if the strike will affect service for AT&T’s landline customers.

AT&T disputes the claims, and says a walkout isn’t in “anybody’s best interests,” but adds that the company is working in good faith toward a new contract for wireline employees in those states.

“We’re very prepared to continue serving customers,” an AT&T spokesman told Consumerist. “We’re a customer service company and we plan for all contingencies, whether related to weather, natural disasters, work stoppages or any other factors.”

Despite claims to the contrary, AT&T maintains that it is a “union-friendly” employer. The company says it has the most full-time, union-represented employees in America, and that it has reached 28 labor agreements since 2015 covering “nearly 123,000 employees.”

AT&T also wants to stress to consumers that this strike does not involve the company’s wireless service.

Uber’s Plan To Let Drivers Ask For Tips May Be Illegal In Some States

Unlike traditional taxis, Uber passengers aren’t expected to tip; you can’t even add a tip on the app. However, Uber did recently settle a class-action lawsuit by allowing drivers to solicit and receive tips, but only in cash. One big problem: This policy appears to be illegal in multiple states.

Many states and municipalities now have regulations that specifically address Uber and other “transportation network companies,” as they’re usually referred to in legalese. Unfortunately for drivers, more than a few of these regulations often restrict drivers’ ability to carry or transact business in cash.

Bloomberg Technology reports that the majority of states have laws that regulate TNCs, and 13 of them ban giving cash to drivers. That could be for off-meter rides, or it could be for tips.

In New York City, for example, drivers don’t have to turn down any tips that you voluntarily give them, but aren’t allowed to solicit them by putting a tip jar in the backseat or by asking. Violations cost the driver a $50 fine.

The Independent Drivers Guild, the group that isn’t really a union and represents the interests of drivers in New York City, plans to ask the city’s Taxi and Limousine Commission to require that tipping be part of TNC apps.

In the rest of New York state, ride-hailing apps aren’t yet legal, and a decision will come from the state capitol sometime this week. The bill that would legalize TNCs is based on model legislation for the industry, and bans tipping.

A similar statewide bill is also in progress in Texas, where Uber and Lyft don’t serve the state capital of Austin,

Lyft, by the way, does allow passengers to tip through the app. This issue is a really a battle between Uber, its drivers, and the social norms that tell us that taxi drivers are a profession that should be tipped.

Uber has historically told passengers that tips are included, or that no tip is needed, but drivers would prefer to follow the norm established for taxi drivers.