Industry News

Homestore could pay millions more for former execs’ legal costs

Criminal case against former officers is scheduled for trial in January

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Homestore, the National Association of Realtors-affiliated company that operates several Internet-based home-search sites, including Realtor.com, will likely be forced to pay much of the $6.3 million that a former executive is seeking to pay his legal defense costs, the company has acknowledged in financial statements. The Securities and Exchange Commission and U.S. Department of Justice in April announced criminal and civil cases against Stuart Wolff, the company's former chairman and CEO who resigned in January 2002 amid an internal investigation; and Peter Tafeen, who served as executive vice president of business development for Homestore until November 2001. The cases allege that Wolff and Tafeen participated in a scheme to artificially inflate the company's online advertising revenues in order to beat Wall Street analysts' expectations. The pair allegedly misled investors and analysts about the company's true financial condition and blamed the company's financial decline on Sept...