Digital Commerce Goes Chapter 11

Digital Commerce Corp. of Herndon, Va., filed for Chapter 11 bankruptcy June 29, as it attempts to reorganize and sell certain assets, its acting president and chief executive officer George Shaunessy said.

The 6-year-old company's filing with the Eastern Virginia federal district court in Alexandria, Va., listed assets of $50,000 or less, liabilities of $50,000 or less and no more than 15 creditors.

The company's electronic marketplaces for government clients, including fedcenter.com and statecenter.com, are still operating, Shaunessy said. However, Washington Technology's calls to the company switchboard Aug. 20 were not answered.

Work also has stopped on COGBuy.com, a site Digital Commerce was hired to develop and run for Metropolitan Washington Council of Governments. The pilot site of COGBuy.com was on schedule until Digital Commerce filed for bankruptcy, said Michael Rogers, executive director of the council.

Digital Commerce's bankruptcy wasn't a surprise, said Tom Meagher, vice president of equity research at BB&T Capital Markets of Richmond, Va. The company was a "typical dot-com start-up" that had been in serious trouble since last year, he said. He blamed the downfall on poor management and the "general malaise affecting the whole [business-to-government] sector."

Digital Commerce had closed a $20 million round in venture capital funding in December 2000 and expected to be profitable by the end of this year, Tony Bansal, then chief executive officer, told Washington Technology in February. The company had backed away from its proposed $115 million initial public offering of stock in September 2000 because of poor conditions in the stock market, Bansal said in February.