"Saum's did not, will not, is not going to file bankruptcy," Schlossberg said.
Schlossberg blamed the nature of the jewelry business for the failure.
"This is not the first jewelry store in Hagerstown to get rocked by market forces," Schlossberg said.
Court records show the financial crisis has been building over the past three years.
In March 1995, Office Manager Patricia I. Domer agreed to get cash advances on her personal credit card to cover operating costs, court records said.
The business was paying her back until Domer resigned in February 1997, records said.
As of last Wednesday, Saum's owes Domer $10,809, records said.
The Public Square store will remain open while the assets are liquidated, Schlossberg said.
Saum-Wicklein plans to open a new business in the building, which is owned by the family and not the corporation, he said.
Video Vision of Hagerstown, owned by Saum-Wicklein's husband, Michael Wicklein, is buying $8,000 of the Public Square store's inventory, court records show.
Saum's has had a presence in downtown Hagerstown since Hampton E. Saum, Saum-Wicklein's great-grandfather, established the business in 1896.
A watch regulator for the railroad, he had come to Hagerstown from Saumsville near Winchester in Virginia's Shenandoah Valley.
His son Fred Saum was an itinerant bookbinder in the Southwest before taking over the business.
Douglas Saum, a watchmaker by trade, became the third-generation Saum in the family jewelry business after he served in World War II. He was an innovator in custom trophies and awards and the use of etched glass.
The family opened a branch at Valley Mall in Halfway in 1972 and in 1982 bought the building on the northwest corner of Public Square.
Last Wednesday, the court approved the appointment of attorney Gary A. Rosen of Rockville, Md., to assume control of the business.
The company's inventory will be sold at auction by James G. Cochran and Associates of Boonsboro, court records show.
There are a total of 27 creditors.
- Miracle Diamond Corp. of New York City, which claims that Saum's never paid them $47,387 for jewelry.
- Danfor Inc. of Fairfax, Va. Saum's has been ordered to pay them $9,931. On April 14, the business account at F&M Bank and Trust was garnished.
- Alton Barclay, who claims Saum's owes him $6,512 for jewelry bought through his Michael Sales Inc. jewelry business out of Silver Spring, Md.
The business also has fallen behind on tax payments, court records show.
This fall, the IRS filed a tax lien for $11,913 in unpaid income taxes, according to court records.
A year earlier, the IRS filed a similar lien for $10,121, which has been paid, court records show.
Other tax liens filed against Saum's are:
- $1,276 by the Maryland State Comptroller on Sept. 15 for unpaid income and sales taxes.
- $1,515 by the Maryland State Comptroller on Feb. 17 for unpaid income and sales taxes. On April 9, the business' account at F&M Bank and Trust was garnished.
The business also has outstanding personal property taxes - $1,027 to the city of Hagerstown and $1,286 to Washington County, according to each treasurer's office.
Valley Mall still has a lease with Saum's for the space near the center of the mall, said Marketing Manager Stephanie Saunders.
The mall has received calls from people who had dropped off jewelry there to be repaired, but came back to find the store closed, Saunders said.
The mall has referred customers to the store's headquarters at Public Square, she said.