BUSINESS
05/27/2011 07:44 EDT | Updated 07/27/2011 05:12 EDT

Blockbuster Canada Gift Cards: 146 Stores Won't Take Them

(CP) - There will be 146 fewer Blockbuster Canada stores that accept gift cards issued by the video and game retailer, starting Friday -- when liquidation sales begin at the locations that will be closed in coming weeks.

The firm Grant Thornton, which is court-appointed receiver for Blockbuster Canada, is maintaining a list of locations that are due to be closed at www.grantthornton.ca/blockbuster.

As of Thursday, there were six more locations on the list than than previously reported earlier this week when store employees got the news.

Ontario will have the largest number of closures (63) but every province will lose at least one Blockbuster store.

Blockbuster currently operates about 400 stores across the country.

An estimated 1,400 employees could lose their jobs out of the 4,000 who work for Blockbuster across Canada.

"While the need to consolidate stores is unfortunate, we are pleased with the level of interest in Blockbuster Canada Co.'s operations expressed by potential purchasers to date," Grant Thornton spokesman Michael Creber said Thursday.

Blockbuster Canada was placed into receivership by an Ontario court this month in the face of US$70 million in claims from various movie distributors, including Hollywood studios, and other suppliers.

The Canadian operations had acted as a guarantor for Blockbuster's U.S. business, which went into bankruptcy protection in September and was later auctioned off to American satellite dish company Dish Network Corp. (Nasdaq:DISH) for US$320 million.

Its new owner is now clashing with the Canadian division, saying it should no longer have the rights to use the Blockbuster name.

Since 2009, Blockbuster Canada had been paying its parent company three per cent of its sales in exchange for the right to use the brand, and argues that if the new owner strips them of that right, it would have a ``devastating impact'' on its business. Stores have been operating under the Blockbuster name in Canada for 21 years.

In papers filed in a New York state court, Grant Thornton said the Canadian operations need to keep using Blockbuster's intellectual property, which includes its name as well as the computer systems that allow it to rent movies.