Eddie Bauer North American retail division enters Chapter 11 for liquidation or sale

Bellevue-based outdoor retailer Eddie Bauer has initiated voluntary Chapter 11 bankruptcy proceedings in the US Bankruptcy Court for the District of New Jersey. The filing is specifically limited to the company's North American brick and mortar operations, which include retail and outlet stores across the US and Canada.

The company has entered into a restructuring support agreement (RSA) with secured lenders to pursue a dual-path strategy: initiating immediate liquidation sales at physical locations while simultaneously seeking an expedited sale of the business as a going concern.

Structural insulation of digital and global assets

In a strategic move to protect the brand’s high-performing segments, the restructuring excludes several key divisions:

Digital and wholesale: These operations were transitioned in January 2026 to a separate licensed operator, Outdoor 5, and will continue to function without interruption;

Intellectual property: Ownership of the Eddie Bauer brand remains with Authentic Brands Group (ABG);

International presence: Independent licensees operating approximately 20 stores in Japan and other locations outside North America are unaffected by the filing;

Parent entity: Catalyst Brands, formed in 2025 through the merger of SPARC Group and JCPenney, remains unaffected and maintains its liquidity and cash flow.

Factors leading to filing

Catalyst Brands chief executive officer Marc Rosen attributed the decision to long-term structural challenges that predated the 2025 merger. Rosen cited a “challenged situation” characterized by declining sales and supply chain hurdles, which were further intensified over the past year by inflationary costs and tariff uncertainty.

He stated that the pace of operational change could not overcome the accumulated challenges of recent years, making the court-supervised process the most viable path to maximize stakeholder value.

To ensure stability during the restructuring, Eddie Bauer has filed first-day motions requesting court approval to use cash collateral. This funding is intended to cover employee wages and benefits, as well as necessary expenses for ongoing operations during the wind-down or sale period.