The Associated Press reports that former Kmart executive vice president Anthony D'Onofrio finally agreed to be deposed by the company’s lawyers and produce documents related to the company’s financial performance and bankruptcy filing.
Kmart and D'Onofrio have been locked in the battle over his testimony, with the company issuing seven different subpoenas to him, all of which were ignored. Kmart then went to the bankruptcy court and asked that D'Onofrio be fined and found in contempt.
Kmart had said that D'Onofrio was a "critical player" in the crisis that led to the company's bankruptcy filing last year.
The Kmart affair has gained some momentum this week. Criminal indictments filed Wednesday by the federal government charged two former Kmart executives with accounting fraud related to a $42.3 million slotting allowance paid by American Greetings Corp. The indictment says that the men conspired to improperly book the $42.3 million payment even though it was repayable under certain circumstances and therefore should not have been fully booked in that period.
One legal analyst told Reuters that in all likelihood, these charges are “stalking horse indictments” designed to squeeze lower level executives into testifying against their former superiors. In this case, one of the likely targets is former Kmart CEO Charles Conaway, who was accused this week by Kmart of malfeasance in his leadership of the company. Kmart is attempting to recover $5 million in retention loans and $4 million in severance that he was granted by the board of directors.
Kmart and D'Onofrio have been locked in the battle over his testimony, with the company issuing seven different subpoenas to him, all of which were ignored. Kmart then went to the bankruptcy court and asked that D'Onofrio be fined and found in contempt.
Kmart had said that D'Onofrio was a "critical player" in the crisis that led to the company's bankruptcy filing last year.
The Kmart affair has gained some momentum this week. Criminal indictments filed Wednesday by the federal government charged two former Kmart executives with accounting fraud related to a $42.3 million slotting allowance paid by American Greetings Corp. The indictment says that the men conspired to improperly book the $42.3 million payment even though it was repayable under certain circumstances and therefore should not have been fully booked in that period.
One legal analyst told Reuters that in all likelihood, these charges are “stalking horse indictments” designed to squeeze lower level executives into testifying against their former superiors. In this case, one of the likely targets is former Kmart CEO Charles Conaway, who was accused this week by Kmart of malfeasance in his leadership of the company. Kmart is attempting to recover $5 million in retention loans and $4 million in severance that he was granted by the board of directors.
- KC's View:
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One can only imagine where the additional testimony by D’Onofrio will lead investigators.
Maybe “Kmart: The Musical”?
Better yet, we could turn it into a series for HBO. It could replace “The Sopranos.”
