Grupo Casas Bahia, one of Brazil's largest appliance and furniture retailers, withdrew on Friday (Aug. 28) its request for state-controlled Banco do Brasil to return R$ 422 million (about US$ 81 million) it claimed had been debited from its accounts. In a petition filed with the São Paulo courts as part of its recuperação judicial, the court-supervised debt restructuring that is Brazil's equivalent of Chapter 11, the company said it is in talks with the bank to reach a consensual solution. "Grupo Casas Bahia informs the withdrawal of all requests related to Banco do Brasil S.A.", the document says, according to Folha de S.Paulo.

The withdrawal ends, at least for now, a dispute that began in the middle of the retailer's supply chain. According to Casas Bahia's initial petition, Banco do Brasil acted as guarantor on sureties the company contracted with suppliers Apple and Mapfre Seguros. After the retailer filed for court protection on Aug. 16, reporting R$ 17.3 billion in debt, the suppliers called those guarantees. The bank paid and, on Friday, Aug. 21, debited the amount from the retailer's accounts to reimburse itself, according to the group's lawyers. On Monday (Aug. 24), the company asked the court to order the money back, arguing that the bank's claim should be subject to restructuring rules, and tried to block further withholdings.

Conflicting accounts of the debit

Banco do Brasil denied that the debit took place and accused Casas Bahia of bad-faith litigation (litigância de má-fé), a legal concept applied when a party lies or requests something contrary to an undisputed fact. The retailer had attached to its petition a screenshot showing R$ 422 million in debits under a "future transactions" tab, dated Aug. 21. The bank answered with screenshots of the group's account statements between Aug. 21 and 24, while preserving banking secrecy.

"The plaintiffs' procedural conduct cannot be treated as a mere mistake, since they were in a position to verify that the alleged debits had not occurred, and that there were no amounts subject to return. It follows easily that the events narrated by the companies under restructuring do not match reality", the bank said in a court filing, according to Folha.

Contacted by Folha, Casas Bahia's press office said on Friday it was verifying the situation. Banco do Brasil said it would not comment on the case. ICL Notícias also reported the withdrawal and said neither the company nor the state bank answered questions.

For the group's suppliers, the case shows the weight of the bank guarantees that keep merchandise flowing to a retailer in restructuring: it was those instruments, called by Apple and Mapfre, that put Banco do Brasil at the center of the dispute. A consensual outcome preserves the company's relationship with one of Brazil's biggest banks while it negotiates its restructuring plan with other creditors. For consumers, nothing changes for now: stores remain open under court protection, but how talks with banks and suppliers unfold will determine whether shelves stay stocked in the coming months.