It's such a shame... when these venerable companies with sterling reputations move away from the products and services that made them profitable, they over-reach and end up in bankruptcy. This company has lost nearly a half-billion dollars in the past three years.
Eddie Bauer changed from selling traditional camping and outdoor gear to more trendy clothes for tweens and teens. This is the kiss of death for many companies because their taste changes more quickly than the company does... we've seen this in so many companies.
There's a good article about this closing here.