Bill Heard dealerships file for bankruptcy

Troubled auto dealer Bill Heard Enterprises has filed for Chapter 11 bankruptcy protection, court documents show.

The company, one of the leading U.S. sellers of Chevrolet vehicles, filed late Sunday in the U.S. Bankruptcy Court for the Northern District of Alabama in Decatur, Ala. The auto dealer is based in Columbus.

Chapter 11 bankruptcy is designed for companies that hope to reorganize and remain in business.

Last Wednesday Bill Heard closed all 14 dealerships, putting 2,700 people out of work.

Burr & Furman, a Birmingham law firm, handled the filing, which shows Bill Heard owes between 1,000 and 5,000 creditors between $500 million and $1 billion. The filing lists assets of $500 million to $1 billion.

Its four largest creditors are Frost National Bank of San Antonio ($1 million plus accrued interest); the Nevada Department of Taxation in Carson City ($970,972); Comptroller of Public Accounts in Austin, Texas ($911,026); and the Georgia Department of Revenue ($769,522).

The company said in a statement last week that the combination of rising fuel prices, a slowdown in car sales and problems in the banking sector piled up to “create a business environment in which the company simply did not have the resources needed to continue to operate.”

Heard had five dealerships in Georgia — four in metro Atlanta and one in Columbus. It had nine dealerships in six other states — Alabama, Arizona, Florida, Nevada, Tennessee and Texas. It closed its Scottsdale, Ariz., dealership on Sept. 12.

Though it blamed the current economic turmoil, the company’s financial and legal problems have been mounting for several years.

The most recent example was GMAC Financial Services’ decision last month to discontinue credit for new inventory for some of Bill Heard’s dealerships. It cited concerns about financial losses at the company.

The company also has had several battles with the Governor’s Office of Consumer Affairs, which has been investigating it since 2003 and accused the company in a lawsuit last year of deceptive marketing practices.