Founder Leonard Riggio Expresses Interest in Barnes & Noble Sale

Leonard Riggio, founder/chairman of Barnes & Noble, said he could take part in the ongoing sales process of national bookseller (and packaged-media retailer), according to a regulatory filing.

Barnes & Noble founder Leonard Riggio

Riggio, who owns 19.2% of B&N, launched his first bookstore in 1965, which later morphed into Barnes & Noble and currently employs 26,000 people at 630 stores across the country.

In October, Barnes & Noble announced that its board of directors had begun a formal review process to evaluate a possible sale of the company – a move supported by Riggio.

The 77-year-old executive said he is “evaluating,” and “may participate” in any potential sale of Barnes & Noble, including making, individually or with others, an offer to acquire the company and/or selling his stake in the retailer in connection with any transaction.

No sale of the company has been announced.

While in the midst of its busiest time of the year, Barnes & Noble remains embroiled in a nasty legal battle with terminated former CEO Demos Parneros for alleged inappropriate behavior in the workplace. The company also claims Parneros scuttled a possible sale of the company to a third party.

Barnes & Noble earlier this month reported a $1.5 million operating loss for its Nook business unit. Revenue dropped nearly 17% to $21.7 million from $25.9 million last year.

The Nook segment, which includes electronic readers and tablets, in addition to digital content (movies, TV shows, music), continues to a bright spot for the last-standing national bookstore chain, which continues to grapple with a changing consumer habits underscored by online entertainment and ecommerce.

Legacy retail sales – which include packaged media – generated an operating loss of $26.7 million. Revenue dipped 2% to $753.2 million.



Barnes & Noble Reveals New Details for CEO Firing

Barnes & Noble has disclosed new details on its firing of CEO Demos Parneros in July after 16 months on the job.

The nationwide bookseller (and home entertainment retailer) in an Oct. 30 legal filing (Parneros v Barnes & Noble, 18-cv-7834, U.S. District Court, Southern District of New York), outlined further details of alleged sexual harassment by Parneros against a female employee, in addition to breach of fiduciary duty after allegedly scuttling a possible sale of the fiscally-challenged company.

Parneros, who maintains his innocence, sued Barnes & Noble in August for wrongful termination and payment of severance, claiming he was abruptly dismissed by the chain’s founder Leonard Riggio for no reason.

Barnes & Noble, in the filing, claims Parneros acted inappropriately with the female staffer he had called into his office, including pinching her neck after comparing heights.

“She also reported that just a few days after this incident, Parneros again called her into his office, inappropriately showed her pictures of what he considered to be romantic Quebec City hotels, told her that he ‘would have taken’ her to those hotels if he were her husband, pulled her towards him so that their faces touched cheek-to-cheek and, as she attempted to pull away, angrily told her that he thought she seemed like someone who ‘would put out’ if he ‘wined and dined’ her,” according to the complaint.

Barnes & Noble says it has received additional complaints about Perneros from other female employees.

In addition, the company alleged the former CEO made repeated negative comments about Barnes & Noble to an unnamed potential buyer, including questioning “Why did I come here?” to the buyer’s representative.

Parneros denies he tried to quash the transaction.

“These false allegations are nothing more than an effort to tarnish my reputation and punish me for seeking justice,” Parneros said in an email statement to Bloomberg.

Barnes & Noble in September reported a first-quarter (ended July 28) net loss of $17 million, up 70% from a net loss of $10.7 million during the previous-year period. Revenue dropped 7% to $794 million from $853 million last year.

The bookseller’s Nook business, which includes digital media such as TV shows and movies, narrowed its operating loss to $330,000 from an operating loss of $2.7 million last year. Revenue dropped 14% to $25.2 million from $29.5 million last year.




Barnes & Noble Reveals Why Its Former CEO Was Fired

Barnes & Noble Aug. 28 issued a statement disclosing why it fired CEO Demos Parneros for cause on July 3 after 16 months on the job.

In a statement from the bookseller’s board in response to a wrongful termination lawsuit brought by Parneros, the company said the suit was “nothing but an attempt to extort money by a CEO who was terminated for sexual harassment, bullying behavior and [violating] other company policies.”

The board said that after advisement from its lawyers, it “unanimously terminated” Parneros’ employment in July following a “thorough investigation” that revealed “multiple examples” of significant misconduct.

Former Barnes & Noble CEO Demos Parneros

“Mr. Parneros not only violated his employment agreement, but also compromised the trust and respect that we strive to foster throughout our organization,” said the board. “Instead of accepting responsibility for blatantly inappropriate behavior, [Parneros] is lashing out against a former employer.”

In his complaint, Parneros alleges he was to meet with B&N chairman and founder Leonard Riggio about selling the company the day before he was fired. Instead of discussing a possible sale of the fiscally-challenged retailer, Parneros says Riggio told him he was being fired.

Parneros denies any wrongdoing.

Barnes & Noble, in its statement, made no mention of a possible sale. Instead, it reiterated that Parneros’ actions were unacceptable and not representative of the “high standards” by which Barnes & Noble operates.

“At Barnes & Noble, we are committed to providing an inclusive, welcoming, respectful and safe workplace,” said the board.