An Arlington facility for brake parts brand Cardone has been caught in the wreckage as a dramatic bankruptcy and criminal proceedings sweep up an Ohio auto parts conglomerate.
A WARN letter filed with the state on Jan. 26 detailed the permanent closure of the Cardone distribution facility at 3000 East Pioneer Parkway in Arlington. A total of 88 employees will be impacted by the closure. Another Cardone facility closing in Harlingen brings the total layoffs in Texas to 129.
The shutdowns come after Cardone parent company First Brands, based in Cleveland, declared Chapter 11 bankruptcy last fall. First Brands owns and licenses a variety of aftermarket auto parts brands, including Michelin-licensed wiper blades and Autolite spark plugs. It employed 26,000 people and did $5 billion in sales in 2024, according to bankruptcy filings.
While a company of First Brands’ size would usually be insignificant, its bankruptcy rocked the financial world because of its funding model. First Brands, founded in 2013 by Patrick James, grew quickly through acquisitions paid for by borrowing money. Much of that money came from the nascent and loosely regulated well of private credit.
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First Brands owed billions, but per an indictment, only had $12 million in its corporate bank accounts when it filed for bankruptcy.
Founder arrested for fraud
On Thursday, founder and — until very recently — CEO Patrick James and his brother Edward, who also served as a First Brands executive, were arrested in Ohio and indicted on multiple fraud charges. Another executive, Peter Andrew Brumbergs pled guilty to related charges and is cooperating with the government.
The indictment accuses the pair of perpetrating a widespread fraud scheme, including inflating invoices, falsifying financial documents and double- and triple-counting collateral.
The indictment also accuses Patrick James of using the fraud scheme to enrich himself by hundreds of millions of dollars.
“The James brothers obtained billions for First Brands — and millions for themselves — by presenting their lenders with the impression of a successful, growing international business,“ said U.S. Attorney Jay Clayton in a release. ”The indictment and the guilty plea unsealed today describe a very different reality: a business run through fraud, fake documents, and false financials.”
First Brands’ bankruptcy and the subsequent arrest of its founder are the second such sequence of events to rattle the world of corporate credit. In late 2025, Daniel Chu, CEO of Irving-based Tricolor, was also arrested following his company’s sudden bankruptcy.
Related
Last-minute ‘lifeline’ doesn’t reach Arlington
On Wednesday, a filing from First Brands indicated it has reached a week-to-week emergency funding agreement — “a last-minute ‘lifeline’”, per the filing — with its OEM customers that, pending approval, would allow First Brands to continue manufacturing critical parts in certain business segments. The filing says that the customers have agreed to prepay for products and operations priced at $48 million for the first week.
The customers include Ford, General Motors, Harley-Davidson, Honda, Polaris, Audi, International Motors, Nissan, Mercury, Volkswagen and BMW, according to the filing.
A hearing on the agreement is scheduled for Thursday.
However, the business segments that contain the two Texas facilities and 15 more nationwide and employing around 4,000 people will still be shut down.
The WARN notice says that First Brands tried to sell the brands without success and could not secure financing in time to save the segments.
“For the past several months, the Company has been actively seeking additional financing that it reasonably believed could be obtained and would have been sufficient to avoid or postpone this shutdown,” the notice reads.
“Although the Company believed financing could be obtained, those efforts were ultimately unsuccessful, and no commitments were made. Once it became clear that no viable source of additional financing remained available, the Company provided this notice.”
First Brands did not respond to a request for comment.
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