But for what?
Today the Boston Globe reports they they succceeded in getting the Norfolk Probate and Family Court to unseal a 1991 post-divorce financial lawsuit brought by Maureen Sullivan Stemberg against Tom Stemberg, former owner and CEO of Staples. The Boston Globe dropped the action to remove the gag order to confidentiality agreement the parties signed in the case to the displeasure of Ms. Stemberg’s attorney Gloria Allred (corrected.
The background for those unfamiliar with the facts:
Tom Stemberg separated from his wife in February 1987. The Stembergs reached a financial settlement and their divorce was finalized in June 1988. Sullivan-Stemberg received 500,000 shares of Staples and the house with a large mortgage. Mr. Stemberg retained 567,000 shares of Staples. The private company stock for purposes of the divorce was valued at $2.25/share and on that basis the major asset split between the Stembergs would appear to be 50/50. Sullivan-Stemberg sold 175,000 shares for $2.25/share and a couple months later sold an additional 80,000 shares for $2.48/share.
The Staples’ IPO took place in April 1989 with an initial offer price of $19.00/share. That subsequent event led to Sullivan-Stemberg’s 1990 lawsuit and Mitt Romney testifying on behalf of Stemberg that the 1988 stock valuation was fair and reasonable. The Stembergs reaching an agreement in the lawsuit may or may not have said anything about the 1988 stock valuation, and therefore, neither confirmed nor disputed Romney’s testimony which appears to have been an opinion based on Bain Capital’s investments in Staples beginning in January 1986.
So, once again, what has the Boston Globe been digging for in this this post-divorce lawsuit?
Evidence of Bain finanacial activities on behalf of Staples that valued the stock at more than $2.50/share? Or documentation of the IPO in preparation before the Stembergs property settlement agreement? Or simply 1987 evidence refuting
Romney described Staples as dysfunctional at the time — a place with “surly” employees and slow checkout times.
Do hope this gets more interesting.
[Update] What I said above about the divorce division of the Stemberg’s stock in Staples isn’t accurate. Boston Globe now reports that Sullivan Stemberg received 500,000 shares of Class D stock that was issued at the request of Stemberg to facilitate his divorce. AP reports a slightly different version of the transaction:
…
Under a plan approved by Romney and other board members in 1988, Maureen Sullivan Stemberg was given 500,000 shares of Staples common stock, then awarded a special “D” class of stock in exchange for those shares. …
The details of the special “D” class stock aren’t currently available. However, based on what is known nothing nefarious can be read into this transaction. There could be any number of valid reasons for such a transaction that had no impact on Sullivan-Stemberg’s financial share of Staples.
Gloria Allred, not Allard.
Yes, could be interesting, but coming too late to do much in the race, methinks. Anybody who’d care already knows what a shitheel Romney is.
Maybe not — but evidence of perjury on the part of Romney would have his team and shills scrambling for a few days to explain why it’s okay. Still, we don’t know what the reporters are investigating. If I had to guess, I’d say that whatever it is they would have preferred not to have Sullivan-Stemberg involved.
I read the Globe’s Friday story following the unsealing of the testimony, and bottom line is this dog won’t hunt.
Oh, it’s nothing to do with Romney’s (lack of) character; it’s that this old-news story has too many complicating details, there’s ambiguity over whether the shares in fact were grossly undervalued, the ex-wife still came out of the divorce vastly wealthy compared to most people, and — most telling of all — it’s not a story one can compress into an easily grokked soundbite.
It wouldn’t at all surprise me if Romney shaded the facts or even lied his overprivileged patriarchal ass off to help another alpha dog protect his wealth from the undeserving ex-wife; but as a takedown of the candidate it’ll be about as effective as Trump’s latest silliness. As you say, nothing nefarious leaps to the eye.
Oh, yeh — I’d link to the 10/26 story, but it’s tucked behind a paywall. I read it in the dead-trees version.
It is, however, interesting that the facts in the case continue to morph. Three things that pop out in this Boston Globe report:
Was it sloppy reporting or Staples/Bain misinformation that has created the confusion over the amount of money Bain investment in Staples?
The third previously unreported item essentially reduces by two-thirds what Sullivan-Stemberg could have realized by selling her stock after the IPO (assuming that her Class D stock wasn’t in some way restricted). You’re correct that most people won’t weep for her (not that I think the BG investigation is about a woman wronged), but those who assert that had she held onto all her stock until after the IPO that she would have been worth approximately $10 million are incorrect. $3 million wouldn’t have made her one of the wealthiest women in Boston.
An obvious question for me is who purchased Sullivan-Stemberg’s 175,000 and 80,000 shares in early 1980. At $6.75 and $7.44/share (after the reverse split), someone did very well. That would have been a private sale and can’t imagine that it didn’t require approval from the Staple’s Board. And once sold, did it remain special Class D stock?
Staples’ IPO (which the Boston Globe undoubtedly has access to) could provide further illumination.
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May be the best one he’s got or the best known, most successful, and least controversial one. That’s why he’s used it throughout his campaign. But you raise an interesting point — if Bain gained on this through some obvious and highly questionable stock transactions, he could take a PR hit.