From the Mercury News: "KB Toys became the second major casualty of the holiday toy price wars, filing Wednesday for bankruptcy protection and announcing it will close up to 500 stores.
The privately held retailer, which has about 1,300 stores mostly in shopping malls, blamed heavy price-cutting by giant discounters, primarily Wal-Mart, which began reducing prices on hot toys such as Hokey Pokey Elmo in October, several weeks earlier than in past Christmas seasons.
``It was brutal,'' KB Toys Chief Executive Michael Glazer said, noting that sales were down double digits this past season.
The Chapter 11 federal bankruptcy filing will enable KB to keep operating while working on a financial reorganization.
The chain, which accounts for about 4 percent to 5 percent of the U.S. toy business and employs about 13,000 people, said it hopes to emerge from bankruptcy protection before the 2004 holiday season.
In early December, FAO, owner of the famed FAO Schwarz toy stores, filed for Chapter 11 for the second time."