As expected, Mitt’s unsealed testimony on behalf of Tom Stemberg, the co-founder of Staples, in a suit by his ex-wife Maureen to amend the financial settlement of their divorce, was that Maureen had gotten good prices when she sold Staples stock in 1988 for $2.25 a share and for $2.48 a share.
A year after those sales, on April 28, 1989, Staples had an IPO at $19 a share and closed its first day at $22.50.
Most of the coverage of this story has described it as about Mitt’s testimony in the divorce proceedings between Staples co-founder Tom Stemberg and his first wife Maureen.
Actually, Mitt testified in post-divorce proceedings, when Maureen tried to get her financial settlement amended. The couple divorced in 1988, and Staples went public in 1989, at which time it was trading at ten times what she got in the divorce.
Gloria Allred, who now represents Maureen, produced three volumes of testimony involving Mitt, testimony that can now be made public. She intends to pursue the denial of the motion to lift the gag order that prohibits Maureen from talking about the case. Tick tock, people, it won’t matter if the order is lifted on November 7.
Mitt’s Bain Capital invested $2.5 million in Staples and got a $13 million profit when the company went public.
“It’s the most comprehensive gag order I have ever seen in my 36 years of practicing law. She apparently is the only person in the United States of America, maybe the world, who cannot speak about Governor Romney.”
Gloria Allred, about the failure to lift the gag order on her client, Maureen Stemberg.
A Massachusetts court has ruled that Mitt’s testimony in the divorce case of Staples’ co-founder Tom Stemberg and his first wife Maureen can be released.
It appears that Mitt testified about the value of Staples at that time, before it went public, and that he may have knowingly undervalued the company to help his friend Tom and hurt Maureen.
The judge refused the request to life the gag order on Maureen, so she will still not be allowed to talk about the case.
So there may be a legal issue of whether Mitt perjured himself by testifying that Staples’ value was less than what he really believed it to be.
Aside from a legal issue, is the political issue of whether Mitt will be perceived by women voters to have hurt a woman — a very ill woman with lupus — by causing her to get less than she deserved in her divorce settlement.
We know now for sure that Gloria Allred’s “October Surprise” is about the divorce between Staples co-founder Tom Stemberg and his first wife Maureen and the financial testimony that Mitt gave at the trial about the value of Staples. Mitt was the primary investor in Staples and a venture capitalist who later helped take the company public.
Allred is representing Maureen Stemberg.
The BostonGlobe is trying to unseal Mitt’s testimony and lift a gag order so that Maureen can talk about the case.
At a hearing this morning, Judge Jennifer Ulwick decided to give lawyers for both Tom Stemberg and Mitt more time to review the testimony Allred had produced.
There will be another hearing tomorrow.
So it looks as if my post from last night that this might be about whether Mitt undervalued the company to help his friend Tom is correct.
I found a story at a site called Tant Mieux from 2/5/08. It says that when Mitt testified in the divorce of Tom Stemberg, the co-founder of Staples, in 1988 he said the company was “over-valued,” apparently in an effort to help his friend Tom and keep Maureen Stemberg from getting a fair settlement.
Early the next year, Staples went public, and Mitt and Tom Stemberg made a ton of money.
So there may be an issue of perjury in his testimony about the true value of Staples at the time.
Stemberg sounds like a piece of work. He wrote a letter to his 12-year-old son with Maureen telling him he could no longer be part of his family because of the trouble he had caused during the divorce.
Also, Maureen suffered from lupus and other illnesses and was unable to work. In 2006, she tried to get more money from Stemberg, who at that point was worth about $150 million. She told a Boston paper that her financial situation was so bad that she couldn’t afford her medications and had had to give the family spaniel away.
Another sad dog story involving Mitt!
UPDATE — There’s a story about one of Maureen’s lawyers called “Ladies Man,” by Gretchen Voss at Boston.com from 11/13/05. It says that Maureen got about 500,000 shares of Staples and that they were valued at $2.25. She sold almost half of them soon after. When Staples went public, the shares were valued at $19 each. She then spent a decade in court trying to get the difference.
TMZ reports that the Massachusetts case in which Gloria Allred will seek to unseal the records and lift the gag order on Wednesday involves the divorce between Staples co-founder Tom Stemberg, a big Romney supporter, and his first wife Maureen. It appears that Allred currently represents Maureen.
Stemberg spoke at the Republican Convention in support of Mitt.
Mitt gave a deposition and testified at the trial in the Stemberg divorce, which apparently was quite protracted and nasty.