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Divine Faces Criminal ChargesA federal grand jury in Chicago has launched a criminal investigation of Divine, the parent company of failed journal subscription agency RoweCom. The Chicago Tribune reported March 4 that libraries that had lost subscription money through RoweCom had begun receiving subpoenas for their records from attorneys for the U.S. District Court for the Northern District of Illinois in February. Other libraries have been contacted by postal officials, suggesting that the investigation is centering on wire fraud. Divine filed for bankruptcy February 25, following RoweCom’s $73.7-million lawsuit against it in January. Company officials acknowledged that they had also received subpoenas from federal attorneys and stated, “We are confident that the documents and facts will reveal that Divine did not engage in any inappropriate activity.” Meanwhile, Ebsco has moved forward in its bid to take over RoweCom operations worldwide. The Birmingham, Alabama–based subscription agency announced March 6 that it was in contact with publishers and customers of RoweCom in Australia to seek support for the purchase. Ebsco expects French regulatory approval by the end of March for acquisition of European operations, but it must await approval by U.S. Bankruptcy Court in Boston for the purchase of the North American business. Posted March 10, 2003. |
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