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Kmart Corp., frustrated that the company’s former executive vice president and chief supply chain officer has not responded to several subpoenas, has asked the court overseeing its bankruptcy to hold Anthony D'Onofrio in contempt.

The company said in papers filed with the court that D'Onofrio was a "critical player in the crisis at Kmart during 2001" and that "questions remain as to whether D'Onofrio, and those working with him, engaged in serious breaches of their fiduciary duties." Kmart has referred to former management of the company as possibly being “grossly derelict” in its duties.

The court was asked not just to issue the contempt citation, but also to fine D’Onofrio and require him to pay Kmart’s expenses accumulated in trying to issue the subpoenas.

According to a report by the Associated Press, D’Onofrio received a $2.5 million retention loan from Kmart as incentive to stay with the company, one of the largest such loans given out by the company to top management.

D’Onofrio reportedly was handed subpoenas at his home in Texas, his office in New Jersey, and at Newark International Airport.
KC's View:
A dead giveaway to the fact that D’Onofrio may be guilty of wasting Kmart’s money is the fact that he lives in Texas and works in New Jersey. By any standard, that’s a helluva commute…no wonder they had to try and serve him papers at the airport.

Seriously, though, one of the reasons that we begin to doubt that Kmart can survive is that so much of its time and effort is being put into court appearances and filings. It is squabbling with Fleming over the terms of their divorce, it is investigating its own misdeeds, cooperating with a number of federal investigations into its behavior -- none of which has any material relationship to the shopping experience that a consumer has walking into a Kmart today.

That’s a problem.