Lauren Coleman-Lochner and Eliza Ronalds-Hannon, Bloomberg Published 7:50 p.m. ET April 22, 2020 | Updated 9:09 a.m. ET April 23, 2020
U.S. Rep. Rashida Tlaib called on private equity firm Thomas H. Lee Partners to pay for health insurance for Art Van Furniture workers who lost coverage after the Midwestern retailer shut down.
Art Van filed for bankruptcy last month and told workers they would have 90 days of coverage as the retailer slowly sold off its stores. But as the new coronavirus spread, many states forced stores to shut down, turning the companyâs liquidation into more of a fire sale. The company later told employees they would lose insurance about six weeks earlier than planned.
Workers sent a letter on Tuesday asking Thomas H. Lee Partners, Art Vanâs private equity owner, to restore their health coverage. Tlaib, who represents a district in Michigan that includes parts of Detroit, is the latest politician to call for more help for workers at bankrupt companies.
âThis is yet another example of private equity firms destroying companies, while screwing over workers and leaving communities to suffer,â Tlaib said in a statement Wednesday. A representative for Thomas H. Lee declined to comment.
Thomas H. Lee Partners bought Art Van and its real estate in 2017 from founder Art Van Elslander for $612.5 million, according to bankruptcy documents. The private equity firm did not make back its investment on that deal by the time of the liquidation, according to a person familiar with the companyâs finances.
Tlaib, a Democrat, was a sponsor of the House of Representatives version of the Stop Wall Street Looting Act introduced by Senator Elizabeth Warren last year. That bill would put private-equity firms on the hook for the debt of companies they buy and elevate worker claims in bankruptcy.
Tlaibâs Michigan district is in a region hit especially hard by the virus, and not far from Art Vanâs headquarters in Warren.
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