James Zimmerman, former chairman and ceo of Federated Department Stores (Cincinnati), has been indicted on felony perjury charges stemming from an antitrust investigation in New York.
Zimmerman is accused of having lied to an assistant New York attorney general about a conversation he allegedly had with Sir Anthony O’Reilly, chairman of Waterford Wedgwood plc (Dublin, Ireland) in 2001. In the alleged conversation, Zimmerman is said to have told O’Reilly not sell Waterford’s upscale products at Bed Bath & Beyond (Union, N.J.), a home goods chain, where it would be competing with Federated’s stores, particularly in the bridal registry market.
During questioning under oath in April 2004, Zimmerman was asked by the assistant attorney general: “Did you ever talk to anyone at Waterford about their selling product to Bed Bath & Beyond in 2001?” He was also asked specifically about Sir Anthony. He answered no to both questions.
Zimmerman entered a not-guilty plea to the charges in state Supreme Court in Manhattan. If convicted, he faces up to seven years in prison.
Federated and the May Department Store Co. (St. Louis) had come under scrutiny after Bed Bath & Beyond’s experimental program to sell the products in a handful of stores came to a sudden end. The retailers were penalized for putting pressure on Waterford and Lenox Inc. (Lawrenceville, N.J.) — another high-end china and crystal maker — to drop their sales at Bed Bath & Beyond. The investigation led to a $2.9 million settlement last August in which Federated agreed to pay a $900,000 fine and May paid $800,000. Waterford Wedgwood’s American division in Wall, N.J., paid $500,000. Lenox paid $700,000. None of the parties admitted guilt.
The indictment, handed down Tuesday against Zimmerman, does not name Federated as a defendant. A hearing is set for March 3 in New York. Zimmerman has until February 17 to file motions in response to the indictment.
According to a company executive, Bed Bath & Beyond now sells Waterford, Wedgwood and Lenox products in its stores and on its web site.