Beginning in 2004, The Sharper Image saw a steady decline in sales. In court filings, the company cited "negative publicity" from litigation involving its
Ionic Breeze air purifiers as one reason for the declining revenue. The Sharper Image sued the nonprofit product testing and rating organization
Consumer Reports for giving the brand's Ionic Breeze air purifiers a "Fail" rating. Consumers sued The Sharper Image for ineffective air purification. In 2006 there was a change in the
board of directors of the company, and the removal of Thalheimer as CEO. Thalheimer was replaced by Chairman
Jerry W. Levin. Not long after, on April 9, 2007, Steven A. Lightman became the president and CEO. The Sharper Image stock price reached a record low of 29 cents a share on February 20, 2008. On February 25, 2008, The Sharper Image announced it had received notification that it would be delisted from the
NASDAQ exchange. The company filed for
bankruptcy protection with the U.S. Bankruptcy Court in
Wilmington, Delaware after four years of sales losses and three straight years of losses. Cash on hand totaled about $700,000. All of its retail stores were closed by the end of 2008. On April 10, 2008, Levin resigned as a member and chairman of the board of the company to pursue participating with other investors to acquire some or all of the company's businesses or assets. News coverage pointed out the stocks fall from about $40 per share to about 23 cents (a $3.6 million
market capitalization) at the time of his departure. Levin joined a group making a bid for the company; the group included
hedge fund Ramius Capital, which was involved in Levin getting onto the company's board of directors, and Clinton Group, which announced a large stake in the company in December 2017.
Post-bankruptcy On May 29, 2008, a
joint venture led by units of private investment firms Hilco Consumer Capital, Infinity Lifestyle Brands,
Gordon Brothers Group, and
Bluestar Alliance won a bankruptcy auction to acquire the assets of The Sharper Image, paying $49 million (about $ in ) plus some contingent recovery for the company's assets. The Sharper Image name was then licensed and used to sell products through major third-party retailers and the branded website. New products were created through partnerships with other businesses. In 2011,
Iconix Brand Group bought The Sharper Image and took control of all licensing relationships, while Camelot Venture Group continued to operate the catalog and website. In June 2014, Camelot Venture Group acquired the rights to the U.S.
direct-to-consumer division of the brand (catalog and e-commerce) from Iconix Brand Group.
Relaunch In December 2016, Irvine-based ThreeSixty Group, the owner of brands such as
FAO Schwarz and
Vornado Air, purchased all remaining rights (including global manufacturing, distribution, and licensing rights) from Iconix Brand Group for $100 million (about $ in ). In 2019, ThreeSixty Group relaunched The Sharper Image with new logos, styling, slogans (including "Tomorrow's Tomorrow"), and a refreshed product assortment. ==Consumer Reports lawsuit==