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AREA MAN SAYS HE WAS 'BURNED' BY SUN
CHEEKTOWAGA RESIDENT CAUGHT UP IN STORE'S BANKRUPTCY FILING

When Sun Television & Appliances Inc. announced earlier this month that it had filed for bankruptcy and would leave the Buffalo market -- again -- Kenneth Costa felt a chill run through his wallet.

Seven days earlier, the Cheektowaga resident had handed a Sun employee $1,495.59 to pay for a new built-to-order computer system that was to be delivered directly to his home. Costa also paid $250 for a five-year extended warranty to ensure a happy long-term relationship with the computer gear.

Unfortunately for Costa, the computer will not be on its way to Costa's home anytime soon, if ever, due to Sun's rocky financial situation.

Dennis Rosen, head of the Consumer Fraud Bureau, of the New York State Attorney General's Buffalo office, said Costa's situation is one of the more extreme consumer problems to come out of Sun's bankruptcy and store closing decisions.

"Most of the complaints we've seen come through this office involve worthless warranties," Rosen said. "The non-delivery of a product that's been paid for, that goes to the next level. It's really a shame."

To date, the local Attorney General's office has received 22 written claims against Sun. The office is maintaining its own file on the situation, as well as passing on those claims to the Delaware court handling Sun's bankruptcy.

But that isn't going to help Costa any time soon.

"I called the Sun store as soon as I heard about the bankruptcy and they said I'd get the computer. They said they would be just a little behind on shipping," Costa said.

But the nervous, would-be computer owner made more calls, only to learn his system would not be shipped.

"I called Sun and Pionex, the manufacturer, and it seems I'm caught in the middle of a stand off between the two of them. Sun owes Pionex money, so they won't give me the computer," Costa said.

Frustrated by having shelled out nearly $1,500 and taking the time to build a computer station to house the equipment, Costa went public with his anger Tuesday. He picketed the Sun store at 2150 Walden Ave. in Cheektowaga.

He marched up and down in front of the store -- which with two others here remains open -- for two hours wearing a sandwich board sign that read "Sun TV stole my money" on the front and "Sun TV is stealing from WNY" on the back.

"I've never done anything like this before, but I felt I had to take some action," Costa said. "I had no idea this kind of thing could happen in the United States of America."

Sun's spokeswoman Melodye Demastus said Tuesday that Costa is not the only Sun customer to be caught in the fray.

"Believe me, the company is well aware of situations like this one," Ms. Demastus said. "All Sun's vendors, except Pionex, are shipping. This is an issue with one particular vendor."

Most of the claims against the electronics and appliance retailer are said to involve extended warranties, which are void in the wake of Sun's bankruptcy filing. Those warranties generally cost consumers between $100 and $300.

In its Chapter 11 filing with federal bankruptcy court in Wilmington, Del., Sun listed assets of $221.8 million, with liabilities of $164.5 million.

Computer manufacturer Pionex Technologies Inc. ranks second on its list of key creditors, with Sun owing the company $3.1 million.

The Whirlpool Corp. was at the top of the list, owed $3.4 million, with Frigidaire Home Products third at $2.6 million; then Hitachi Home Electronics, $2.2 million; and Philips Consumer Electronics, $2 million.

Ms. Demastus said all the other vendors are shipping to the Sun stores, which will remain open. Negotiations with Pionex have ended with the computer company demanding payment in full before any additional products are shipped, according to the spokeswoman.

While the state Attorney General's office doesn't make an official tally of phone complaints, Rosen described the volume of those calls within the first few days of Sun's announcement as "significant."

Consumers have three avenues to stake a claim related to undelivered merchandise or dishonored warranties. They can obtain a proof of claim form via the Attorney General's Office, the Delaware court or through Sun's consumer hot line.

Claims filed through any of these routes will eventually be made part of the bankruptcy petition, which is likely to take many months to be resolved. And unfortunately, consumers will find themselves at the end of the line for any repayments, according to Ronald Kermani, of the Alliance for Consumer Rights.

"The sad situation is that consumers give their faith and money to a company and then find themselves at the bottom of the barrel when it comes to reimbursement," Kermani said.

The spokesman for the Albany-based legal think tank said consumers line up in back of the government and suppliers in cases like this, as the filer attempts to repay pennies on the dollar.

"I'm not saying they shouldn't file a proof of claim," Kermani said. "But while they need to protect their right to reimbursement, they shouldn't expect to see the money quickly or in big amounts."

Consumers who purchased extended warranty packages from Sun in the past few months might have another course of action if they paid for them with a major credit card, according to Rosen.

"In many cases, the credit card companies will treat a warranty gone bust the same way they would handle a product that broke or malfunctioned. They might take it off your bill," Rosen said.

Consumers who think they would qualify for reimbursement via credit card protection should contact their card issuer in writing, enclosing a copy of their bill of sale as soon as possible.

For Costa, who paid for his computer system with a debit card, that option is not available, as the bank treats that transaction as a cash deal, with no enhanced protections.

Sources of help and information for customers of Sun Television and Appliances include the following:

N.Y. Attorney General's office: 853-8404: to obtain proof of claim form and/or file complaint.

Sun TV consumer information line: 800-730-5262 for information on extended warranties; and/or request a claim form.

U.S. Bankruptcy Court, Wilmington Del: 302-573-6174: to obtain proof of claim form and filing information.

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