The company, which sells jewelry, dinnerware and furniture in New York, New Jersey, Pennsylvania and Connecticut, began suffering a "severe liquidity crisis" in January as it was trying to sell the company, according to court documents.
The collapse of the hedge funds in June 2007 coupled with questions about Bear Stearns management and oversight threw the firm into a severeliquiditycrisis.
Falling property prices caused defaults and a liquiditycrisis in the banking system so severe that the authorities feared the cash machines would stop working.