Second former Rite Aid executive sentenced
HARRISBURG, Pa. (AP) – A former vice president at Rite Aid Corp. on Wednesday became the second of six company officials to be sentenced for his role in the financial scandal that crippled the drug store chain four years go. Philip Markovitz was sentenced by U.S. District Judge Sylvia H. Rambo to one month in jail, five months’ home confinement and a $5,000 fine. He must surrender on June 28 to begin serving his time.
“I cannot tell you how deeply I regret my misconduct, nor how ashamed I feel at disappointing people who mean so much to me,” Markovitz told the judge.
Markovitz pleaded guilty in July to conspiracy to obstruct justice.
He testified in October at the trial of former vice chairman Franklin C. Brown that he lied to a federal grand jury – at Brown’s urging – when he said he received a lucrative benefits letter from former chief executive officer Martin L. Grass before Grass left the company in October 1999. Markovitz said Brown actually presented him with the letter weeks after Grass left Rite Aid.
Markovitz joined the Camp Hill-based company in 1971, eventually rising to the position of vice president of real estate. He resigned in February 2000 and joined Elysian Partners in Lemoyne, a commercial real estate company in which Grass is a partner.
Rambo is expected to sentence former Rite Aid chief financial officer Franklyn M. Bergonzi later Wednesday for one count of conspiracy.
Bergonzi convinced Rambo last week that he played a relatively minor role in the accounting scandal that prompted the company to retroactively lower net earnings by $1.6 billion in July 2000, thereby earning a reduction in his potential sentence.
Eric S. Sorkin, former vice president for pharmacy purchasing, on Tuesday was sentenced to five months in prison and five months of house arrest for one count of conspiring to obstruct justice, although Rambo stayed the sentence to determine his work-release eligibility.
Grass faces sentencing on two conspiracy counts Thursday, and could receive up to 10 years. A fifth executive, Timothy J. Noonan, will be sentenced next month for withholding information from company investigators. No date has been set for the sentencing of Brown, convicted by a jury of 10 criminal counts.
AP-ES-05-26-04 1306EDT