Bankruptcy Leaves Blockbuster Gift Cards Worthless

UPDATED: Friday April 22, 2011 2:50 PM

If you have a gift card to movie retailer Blockbuster, chances are it won't get you anything, Consumer 10's Kurt Ludlow reported on Monday.

Diane Russell has never met a movie that she did not like. Thanks to rentals from Blockbuster, every night is movie night at her house.

"We've had this membership at Blockbuster for 20 some years," Russell said.

Russell, a loyal customer for two decades, said the last time she tried to use a Blockbuster gift card to pay, she was told it was not working.


Her gift card, like every other Blockbuster gift card in America, was suddenly worthless, Ludlow reported. 

As a result of Blockbuster's asset sale, which is related to its bankruptcy proceeding, its gift card program has been discontinued, Ludlow reported.

Blockbuster had given a one-week notice that it would stop accepting gift cards, but many customers never received it.

While there are laws to protect gift card buyers in Ohio, the Ohio Attorney General said they are trumped by federal bankruptcy proceedings.

And, the AG said, there is nothing to require Dish Network, the new owner of Blockbuster, to accept those gift cards once the sale is complete, Ludlow reported.

"You would think that they would allow you to finish using those gift cards as long as they're open, wouldn't you think?" Russell said. "I mean if they totally closed then I can understand, but they're still doing business.  So they're not going let me use my $9."

Generally gift cards in Ohio cannot expire for five years, however if a company goes out of business, or bankrupt, there is not much that can be done to get your money back. 

Still, the Ohio Attorney General said consumers holding a Blockbuster gift card with an outstanding balance should file complaint with his office.

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