The news wasn't entirely unexpected. Bad news relating to expensive leases and a downturn in the economy surfaced months ago, and The Industry Standard's drew mostly negative bets from readers after it was created last week.

Chapter 11 gives the company room to breathe while it restructures its operations and financial obligations. Stores will remain open, and shelves will be stocked with merchandise. In a FAQ sent to The Industry Standard and other media outlets, Circuit City noted that Chapter 11 would "provide the company's vendors with assurances that they will be paid for merchandise the company receives post-filing so we can be sufficiently stocked for the holiday selling season."

However, there are questions about how the Chapter 11 filing will impact the sale of big-ticket items, such as a TV, PC, or other components. Transactions will be straightforward, but there are service-related issues that customers will need to think through.

If you've bought electronics from Circuit City, Best Buy, Sears, or practically any other chain retailer, you are no doubt familiar with the post-warranty insurance and service policies that staff attempt to tack onto every sale. The pitches are sometimes pushy, and no wonder: They are an extra revenue stream for retailers, and can be very profitable. To a lot of people, they also provide piece of mind -- what if that US$1,500 LG HDTV goes on the fritz on the 366th day?

But the country is in the midst of a terrible financial crisis. What if the restructuring is not successful, and Circuit City shuts its doors before the warranties' terms have ended?