CANTON, Mass. (AP) - In newly unsealed testimony related to Staples founder Tom Stemberg's divorce, Republican presidential candidate Mitt Romney says he was initially skeptical of the idea for Staples, the office supply chain he lauds as a business success story that he helped create.
Romney also acknowledged in testimony in Massachusetts probate court in 1991 that he and other Staples directors created a special class of company stock for Stemberg's then-wife as a "favor" to Stemberg.
A Massachusetts judge unsealed Romney's testimony Thursday at the request of The Boston Globe. Celebrity lawyer Gloria Allred, representing Stemberg's ex-wife, unsuccessfully argued that the judge should also lift a confidentiality agreement that prevents her and her client from talking about the case.
The three days of testimony had been kept sealed for almost two decades after Maureen Sullivan Stemberg sought unsuccessfully to alter the divorce agreement that provided her with 500,000 shares of Staples stock.
Romney said during the hearings that in Staples' early days, its initial stores performed "far behind our expectations." He said friends told him that Staples was "a hard place to shop" and employees were "surly."
During the presidential campaign, Romney has described Staples as a "great American success story" and has taken credit for its growth to a mega-firm employing nearly 90,000 workers. Stemberg was one of the speakers who praised Romney last August at the Republican National Convention in Tampa, Fla.
Asked in 1991 what he thought when he was approached about the idea of investing in an office supply chain, Romney was skeptical.
"I told him I didn't think it was a very good idea, but I'd look at it," Romney testified. Once he got the plan, however, "I was impressed with the quality of the thinking and the thoroughness of the plan and arranged for a meeting with Tom Stemberg and his managers."
In hundreds of pages of 1991 testimony, Romney said his conservative estimate of Staples' financial worth at the time was justified. Lawyers for Stemberg's wife questioned whether the stock should have had a higher value before she sold her shares in 1987.
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. She sold about half of the shares only to learn that those sold holdings would have been valued higher in a 1989 public offering of Staples stock.