Source: Bernard Smalls / @PhotosByBeanz
Almost a year after now infamous sneaker reseller Zadeh Kicks shut down his operation and ended up getting investigated by the FBI, another sneaker reseller is following suit under somewhat similar suspect circumstances.
According to Nice Kicks, Schmidty Kicks, known for reselling sneakers at higher than retail prices, filed for bankruptcy over the weekend. Apparently it owed creditors $18,473,066.33 while only having $808.49 in assets. They must’ve had four pairs of The Air Jordan 1 “Brotherhood’s” left in stock or something. Those aren’t going anywhere on the secondary market either. Just sayin.’
Altogether Schmidty Kicks owes 661 creditors debts ranging from as little as $212 to as much as $6 million to the payment processor Stripe. Like many resellers over the past few months, Schmidty Kicks done learned that the reselling game isn’t what it used to be. Highly anticipated sneakers are hard to come by (thanks bots and backdoors) and more kicks are considered bricks than grails by the everyday sneaker aficionado.
Schmidty Kicks declared that it owes more than $350,000 to other family members of the president Brett Schmidt and $1,738,600 to Schmidty Kicks Fund – an entity that lists Brett Schmidt as a principal in an SEC filing dated in February 10, 2022.
In the bankruptcy filing, Schmidty Kicks’ President Brett Schmidt declares that potential assets the failed business has include money owed from Zadeh Kicks, its founder Michael Malekzadeh, and CFO Bethany Mockerman.
It’s not looking good out here for bulk sneaker resellers.
Zadeh Kicks founder Michael Malekzadeh and his fiancee Bethany Mockerman meanwhile are currently facing multiple fraud charges for “selling” sneakers he never actually had. Zadeh Kicks was the talk of the sneaker town after he abruptly shut down his sneaker reselling operation and blew town with millions in unfulfilled orders.
After the sneaker community exploded in anger and astonishment at the sudden shuttering of Zadeh Kicks, the FBI got involved. They not only hit Malekzadeh and his ride-or-die with fraud charges, but also confiscated his personal sneaker stash and whatever he had in storage and resold them on eBay at the end of 2021.
Naturally Malekzadeh and Mockerman pleaded not guilty to all charges but, well, it’s not looking good for them right now.
What do y’all think of Schmidty Kicks being the latest sneaker reseller to go down in flames? Do y’all even trust sneaker reselling websites anymore? We know we don’t. Let us know in the comments section below.
