Sleep specialty retailer files for Chapter 11 in California

LOS ANGELES — Bedding specialty retailer Ortho Mattress filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Central District of California on June 1.

In the petition, the Van Nuys, Calif.-based retailer, which manufactures its mattresses, estimated assets between $1,000,001 and $10 million vs. estimated liabilities of $10,000,001 to $50 million to an estimated 50 to 99 creditors.

Some bedding and bedding-adjacent companies are its top 20 unsecured creditors, including E.S. Kluft Co. ($165,007.70), Simmons Manufacturing ($108,122.00), Enriquez Materials Quilting ($83,378.80) and Culp Ticking Inc. ($46,374.28).

See also:

• Bestar files for Chapter 15 in Delaware bankruptcy court
• American Mattress bankruptcy case converts to Chapter 7

In a second document filed June 1 requesting rejection of leases to 14 locations it has already vacated, leaders revealed that Ortho Mattress currently operates 18 standalone stores, two warehouse/retail locations and one factory/retail location, all of which are leased from third parties. At its peak, it operated approximately 80 showrooms but reduced its footprint over the past four years because of increasing inflation and higher post-COVID interest rates, which caused mattress sales to collapse nationwide.

The filing goes on to note that in recent years, it implemented efforts to cut costs and manage margins while it expended reserves over the past three years in hopes that economic conditions would improve. But due to the factors it outlined plus a decline in housing transactions, Ortho Mattress was forced to close several stores. Additionally, that filing noted that it faced difficulty operating in certain areas of Los Angeles due to vandalism, crime and danger, which makes it hard to retain employees in those locations.

In the filing, it is noted that Ortho Mattress believes it has a viable business that can and should be able to successfully organize and debtors intend to propose a plan of reorganization within 90 days of the petition date.

Ortho Mattress was founded in Gardena, Calif., in 1957. On its website, its history is outlined, including its 1996 merger with W. Simmons Inds. and subsequent renaming to WE Bedding; its 1998 acquisition by High Street Holdings; the reopening of its factory in Cerritos, Calif., in 2002; its renaming to Ortho Mattress in 2004; and its 2006 acquisition of the assets of Simmons Mattress Gallery in 2006, among the highlights. In 2020, it pivoted and produced masks to help curtail the spread of COVID.

Furniture Today has reached out to Ortho Mattress.