Rite Aid trial is delayed till March

Executives had sought a 1-year postponement

September 10, 2002|By Gus G. Sentementes | Gus G. Sentementes,SUN STAFF

The trial of Rite Aid Corp.'s former chairman and chief executive, Martin L. Grass, and three former and current executives, scheduled to begin yesterday in U.S. District Court in Harrisburg, Pa., was postponed by the judge until March 3.

Attorneys for Grass and the other executives sought a one-year postponement, citing the case's complexity and the large volume of documents. Prosecutors had acceded to a trial postponement of less than one year, said Martin Carlson, first assistant U.S. attorney in Harrisburg.

"The defense has filed a battery of motions to which we need to respond, and the court will need sufficient time to review all the motions and make appropriate rulings," Carlson said yesterday.

Last week, Grass and the other defendants asked that the trial be moved out of Harrisburg, arguing that heavy media coverage has biased public opinion against them.

District Judge Yvette Kane has yet to rule on that motion.

In a 37-count indictment issued in June, a grand jury charged Grass and two others -- former Chief Financial Officer Franklyn M. Bergonzi and former vice chairman and general counsel Franklin Brown -- with offenses relating to an alleged accounting fraud that led Rite Aid to revise earnings downward by $1.6 billion two years ago and left the Camp Hill, Pa.-based company on the verge of bankruptcy.

The charges include conspiracy to defraud, making false statements to the Securities and Exchange Commission, obstruction of justice, and fraud in connection with the purchase or sale of securities.

Some of the charges carry maximum penalties of 10 years in prison and a $1 million fine.

Another defendant, Eric S. Sorkin, Rite Aid's executive vice president for pharmacy services, has been charged with lying to a grand jury and obstructing justice.

Sorkin, who is on unpaid administrative leave, is seeking a separate trial, according to court papers.

As part of their request for a postponement, defendants' attorneys had argued that a large number of documents were lost or misplaced by the Securities and Exchange Commission after the Sept. 11 terrorist attacks destroyed the World Trade Center in New York.

"We asked for fall 2003, given the unbelievable amount of documents and the complexity of accounting issues," said Reid Weingarten, Brown's attorney. He said the judge and both sides had agreed to a postponement last week during a conference call.

Grass, 47, who lives in Virginia Beach, and his attorney could not be reached for comment.

Attorneys for the other defendants either could not be reached for or declined to comment.

Grass and the other defendants had asked the judge in earlier court filings to remove herself from the case because she had worked for a law firm whose associates are expected to testify during the trial, according to published reports.

Grass said in court papers that Kane once did legal work for a real estate firm connected to him and was formerly associated with a Philadelphia law firm where some attorneys might be called as trial witnesses, the reports said.

In an order yesterday, Kane denied the defendants' request that she disqualify herself.

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