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New Food Classics, the company behind the E. coli recalls, in the middle of bankruptcy proceedings

Lost in much of the talk about E. coli-laced burgers (and confusion over what, exactly, a steakette is), was the news that New Food Classics, the Burlington meat processor behind the recall, is in the middle of bankruptcy proceedings. While many of the company’s products have been flagged for potential contamination, that’s only a small portion of what they’re struggling with. The Hamilton Spectator reports that the company has closed an office in Calgary and plants in St. Catharines and Saskatoon, and sought creditor protection before looking for a buyer to bail it out. Of the 22 would-be bidders, only one actually made an offer after seeing the company’s statements. So is it just the bad meat that’s dragging the company down? Hardly. The Spectator says bankruptcy documents indicate that “the company was hobbling as its beef and energy costs climbed in 2010 and 2011 while it was locked into price contracts with customers such as Loblaw, Metro, Sobeys, Walmart and food supply giant Sysco Canada.” In case that doesn’t make the situation clear enough, when the Spec sought comment from NFC yesterday, they didn’t hear back. The phones lines might have been busy all day—but they might have simply been disconnected. Read the entire story [The Hamilton Spectator] »

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Culture

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HMV looking at closing stores in Canada as music sales appear to be capital-D doomed

His master's void: profit gaps responsible for possible closures (Image: bm.iphone)

This manages to be even less surprising than the Blockbuster bankruptcy filing in the United States: according to The Daily Brew, HMV may be looking at closing some—or even all—of its Canadian stores. As sales of CDs and DVDs stumble, HMV’s search for other options hasn’t paid off:

The closures will likely be announced before an April test of its borrowing rules, which are expected to be tight. And, while the HMV Group will apparently seek to end its leases in shopping malls across Canada, an imminent exit altogether isn’t seen as likely.

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Random Stuff

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Panel recommends “considerable downsizing” to Pride festival, along with new ways Pride Toronto can avoid another lousy year

The 2010 Pride parade. 2011’s may be a little slimmer (Image: ryePix)

Last year, it’s safe to say, will not go down in the history books as Pride Toronto’s greatest. There was the Queers Against Israeli Apartheid debacle and associated internal strife, all culminating in last month’s revelation that the festival is insolvent, having spent way more last year than it took in. The job of fixing this mess fell to Pride Toronto’s Community Advisory Panel, chaired by the Reverend Brent Hawkes. The CAP’s report is here [PDF], but to summarize: “Pride Toronto, say you’re sorry and make sure that 2010 never happens again.” We’re not kidding. A general apology is one of the first recommendations.

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Random Stuff

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Pride Toronto’s severe case of TGIF: how the gay and lesbian festival ended up having one of its worst weeks ever

This has been a nasty week for Pride Toronto. The bad news started on Wednesday, when it came out that Pride had overspent its revenues for 2010 by more than $400,000, having blown through all the money the group raised in 2010 plus a sizeable surplus that had been left over from 2009. Then, on Wednesday, Pride Toronto’s executive director Tracey Sandilands resigned after the discoveries of the massive deficit and the fact that she had given a $40,000 job to her partner. Finally, at last night’s raucous general meeting, the board had to answer questions that sometimes got as blunt as “how do we call for all your resignations”?

How did Pride get in to this financial—and now, political—disaster? A brief recap, after the jump.

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Business

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Pride Toronto almost bankrupt, thanks to pulled federal funding and QUAIA fiasco

Toronto Pride parade 2010 (Image: Eduardo Milano)

Last year wasn’t one of the best on record for Toronto Pride. It had the controversy around Queers Against Israeli Apartheid (QUAIA), which split the city’s gay community and “threatened to bankrupt” the organization. Pride Toronto also had its federal funding pulled, even though Canadian Press reports that it had qualified for federal cash. This year doesn’t seem to be treating the organization any better, with the revelation that it will have to tell its annual general meeting it’s effectively bankrupt.

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Features

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Gold Wars: inside Toronto’s cash-for-gold battle

What happens when two gold buyers set up shop kitty-corner to each other in a rabidly competitive industry? A tale of death threats and gunshots in the night at Bathurst and Glencairn

Around noon on July 16, a large, Iranian-born man named Saeed Hosseini purportedly walked into Easy Cash for Gold, a storefront near Bathurst and Glencairn, and asked to speak in private with the owner, Jack Berkovits. Berkovits, a grizzled 58-year-old who also owns a chain of jewellery stores called Omni Jewelcrafters, took Hosseini to a nearby kosher restaurant called King David Pizza. They ordered coffee and sat. After much prevarication, Hosseini, a tae kwon do specialist and former mixed martial arts competitor, finally admitted that he had no gold to sell. Instead, he claimed he was there because of Maria Konstan, an employee of a competitor named Harold Gerstel, a man better known by his public moniker Harold the Jewellery Buyer. According to Hosseini, Konstan had asked him to kill Berkovits. Having said this, Hosseini quickly assured Berkovits that he wasn’t going to do it; he just thought Berkovits should know that Konstan not only wanted him dead, but was willing to pay someone to do it.

(Photograph: Keith Beaty/Getstock; Illustration: Asaf Hanuka)

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People

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Actor Randy Quaid seeks Canadian refugee status

Refugee status hopeful Randy Quaid (Image: James Jeffrey)

Sometimes famous people do crazy things, and sometimes they do it in Canada; when that happens, we’ll be there to slap on a pair of handcuffs and give them an immigration hearing! Such was the order of events for actor Randy Quaid and his wife, Evi, who were detained in Vancouver last Thursday after local authorities learned of outstanding American warrants for their arrest.

The Quaids are wanted for charges related to squatting in a home they formally owned, the latest in a series of legal and financial blunders for the troubled actor and his wife. Quaid filed for bankruptcy in 2000, and though his career momentarily resurged thanks to his performance in 2005′s Brokeback Mountain, he was eventually banned from the Actors Equity Union in 2008 due to claims he’d physically and verbally abused other actors.

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Business

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Blockbuster’s belly up: least surprising bankruptcy since David Crosby

(Image: travdir)

On the heels of this week’s Netflix launch in Canada—with a pretty major PR snafu—comes the news that Blockbuster Video (one of Netflix’s biggest U.S. rivals) is filing for bankruptcy protection. South of the border, the once-ubiquitous blue-signed video rental stores have been steadily losing business to services like Netflix, while the less legally inclined have been turning to the Internet to download movies. Here in Canada, Netflix has been less of a factor, but there’s more than one shuttered Blockbuster outlet in Toronto. The company says its international stores are doing fine (outside of Argentina), but it’s not hard to see the writing on the wall. How did Blockbuster come to this?

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The Goods

Stores

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Unhappy hipsters: is Dov Charney out at American Apparel?

The unhappiest hipster (Image: Dov Charney)

With Tuesday’s news that pleated pants purveyor American Apparel may have to declare bankruptcy, shares plummeted into penny-stock range, raising questions about flamboyant CEO Dov Charney’s tenure at the company. The Financial Post writes that if a new investor comes in to save AA, the company would “almost certainly” push Charney out. If Charney is forced out, the Post theorizes “investors and observers would lose perhaps the most colourful Canadian chief executive of a public company.”

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People

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Michael Stadtländer and Jamie Kennedy walk away with new Governor General’s Cuisine Awards

Honourees Jamie Kennedy, Michael Stadtländer (Images: Edlynne, farmerchefconference)

The Governor General’s Awards, heretofore known for honouring the best in Canadian academics and arts, have added a new category to their ranks: cuisine. Yesterday, in an award ceremony at Rideau Hall, celebrity chefs Jamie Kennedy and Michael Stadtländer received a joint distinction for their role as culinary leaders by outgoing GG Michäelle Jean and her husband, Jean-Daniel Lafond (the new awards were apparently his idea).

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The Goods

Stores

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Death of the hipster? American Apparel in serious financial trouble

(Image: American Apparel)

We might soon be shopping for our low-cut V-neck tees at Urban Outfitters, because American Apparel is in some dire financial straits. Last March, the company secured an $80-million loan that helped it escape a looming bankruptcy, and yesterday, American Apparel shares dropped 42 per cent when it revealed it likely won’t meet its obligations to debtors.

In trying to fix its financial woes, the company has delayed filing its first quarter results, leading the American Stock Exchange to consider delisting the stock. In Toronto alone, there are seven American Apparels to sate the need for shiny metallic spandex tights, but same-store sales in Canada are down 15 per cent (they’re down three per cent in the States). If American Apparel goes under, where will we get our semi-pornographic advertising? Oh, wait.

American Apparel’s latest financial mess [New York]
American Apparel shares sink [Reuters]

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People

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Canwest roulette: Paul Godfrey bets $1.1 billion on newspapers, spins the wheel

This marks the end of the Canwest saga and the beginning of the Paul Godfrey saga. Godfrey, president and CEO of the National Post, has led a group of moneybags to buy the newspapers of the Canwest chain for $1.1 billion. Given that Shaw claimed the TV stations earlier, the core of the company—and the Asper family’s dream of a media monopoly—is now officially torn apart, although in surprisingly fewer pieces than predicted.

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The Dish

Deathwatch

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Circa nightclub is officially dead, please fist-pump elsewhere

Halloween at Circa (Image: Divya Thakur)

Circa’s doors have been shut for a month, but today the Star is officially confirming that the John Street über-club has filed for bankruptcy.

A closed sign is posted on the club’s home page along with the message “Thank you for supporting us over the years”; Nelly Furtado’s “All Good Things (Come to an End)” plays in the background. The relationship between the “good things” and Circa remain unclear, although we’re pretty sure they are not referring to the nightclub’s $2.1 million in debt.

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The Informer

Business

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Skyservice grounded in latest Canadian aviation development

(Image: WestendRaider)

While reading the coverage of Skyservice’s sudden collapse, we can’t help but wonder if the people running the charter air service shared a few sheepish face palms. In addition to explaining that key shareholders, Gibralt Capital and Sunquest Vacations, called in their loans (sending the airline into receivership and laying off more than 1,000 employees), Canwest reports: “Skyservice’s costs were 30 to 40 per cent higher than its competitors Canjet, WestJet and Sunwing. About 74 per cent of its workforce was unionized, and it flew older, less efficient planes than its rivals.” So that’s how to run a business—if not an airplane—into the ground.

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