201501.23
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SkyMall LLC Files for Bankruptcy

The company behind the in-flight catalog SkyMall filed for bankruptcy protection, a victim of evolving rules and technology that now lets airline passengers keep their smartphones and tablets powered up during flight.

After 25 years selling quirky products like a Darth Vader toaster or a paper towel holder with USB ports, SkyMall LLC is seeking a court supervised sale of its assets, according to papers filed Thursday with the U.S. Bankruptcy Court in Phoenix.

“We are extremely disappointed in this result and are hopeful that SkyMall and the iconic ‘SkyMall’ brand find a home to continue to operate,” acting Chief Executive Scott Wiley said in a statement Friday.

The company, which started in 1989, fully suspended its retail catalog operation Jan. 16, and also laid off 47 of its 137 employees, according to court papers. SkyMall’s parent company Xhibit Corp. , which acquired the business in 2013, is also seeking Chapter 11 protection.

The catalog can often be found in the seat pockets on many domestic flights, but airlines had been cutting back. Delta Air Lines ended its contract with SkyMall in November, court papers said, and Southwest Airlines informed the company in December that it would stop carrying the catalog later this year. “We saw a decline in customer use of the publication,” a Delta spokesman said.

The increase in the number of airlines providing Internet access “resulted in additional competition from e-commerce retailers and additional competition for the attention of passengers, all of which further negatively impacted SkyMall’s catalog sales,” Mr. Wiley said.