Spiegel's Legal Eagle

Martin Zaepfel, ceo of Spiegel Inc. (Downers Grove, Ill.), has resigned after less than two years on the job amid a financial crisis that threatens to send the retailer into bankruptcy.

To replace Zaepfel, Spiegel has hired a turnaround firm to help stem its financial downspiral. William Kosturos of Alvarez & Marsal Inc. (New York) will serve as Spiegel's chief restructuring officer and interim ceo. Alvarez & Marsal has been hired in the past to restructure a number of companies, including Ames Department Stores Inc., Trump Casinos, Arthur Anderson and Warnaco Group Inc.

Debbie Koopman, a spokeswoman for Spiegel, said Zaepfel's decision to leave the company was not related to the ongoing Securities & Exchange Commission investigation on whether officers and directors committed securities fraud by withholding information on the company's faltering financial status. When Zaepfel joined Spiegel, he signed an employment contract that expires in July 2006. “Martin made a personal decision to retire,” Koopman said.

Spiegel, owned almost entirely by the Otto family of Germany, is primarily a direct retailer of apparel and home furnishings through its Spiegel catalog, but it also owns the 550-store Eddie Bauer chain.