A past employee of the BiWay discount chain has launched a class-action lawsuit against the former directors of its bankrupt parent, retailer Dylex Ltd. Thomas Englefield, who spent 15 years as a manager at the defunct bargain-basement retailer is seeking $18.4 million in severance pay and $20 million in punitive damages on behalf of 4,000 employees who lost their jobs.

Great American Group, a California-based liquidator that sold off BiWay's stock and former Dylex directors Arthur Jacques and Donald McCarthy are named in the suit. Hardof Wolf, the sole remaining director of Dylex, is also named.

Wolf heads Hardof Wolf Group, the company that bought Dylex for $68-million last May before it plunged into insolvency amid rumours of fraud.
The purchase relied on money in Dylex coffers as well as proceeds from the sale of BiWay's inventory.

An extensive probe by bankruptcy trustee Richter & Partners Inc has revealed that a substantial portion of the money Hardof Wolf used to purchase Dylex came from Dylex's own bank accounts, leaving creditors in the lurch. Claims against the company exceed $80 million.