G&J Exec Who Revealed Circ Inaccuracies Quits

Diane Potter's Testimony Was the Lightning Bolt of Rosie Trial

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NEW YORK (AdAge.com) -- Diane Potter, the Gruner & Jahr USA Publishing executive who set loose a firestorm of controversy with her Rosie trial testimony about allegedly inaccurate magazine circulation numbers, has resigned her position.

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Pre-trial deposition
Ms. Potter was the senior vice president of consumer marketing at the publishing company. She exploded into the headlines during the recent courtroom battle between G&J and its former magazine icon, Rosie O'Donnell, when in a pre-trial deposition she admitted that the publisher knowingly submitted extraordinarily overstated newsstand sales figures for the defunct Rosie magazine.

In her deposition, Ms. Potter said, "Rosie's newsstand sales were so low compared to what we had seen previously" that the company feared "if we were to report them accurately, the advertising community would react so negatively that the magazine would be in great difficulty." For the first half of 2001, G&J overstated Rosie's newsstand sales by 32%.

Ms. Potter's resignation is effective immediately. Her department will continue to report to Executive Vice President Dan Rubin until a replacement is found. Ms. Potter resigned "because she feels it is in the best interest of the Company," read a brief e-mail memo sent to staffers from G&J CEO Dan Brewster. "I have known [Ms. Potter] professionally for many years, liked working with her, and will miss her."

Mr. Brewster was asked last week in a post-trial meeting with reporters about the eventual fate of Ms. Potter and other key executives at the company, including himself. Mr. Brewster said, with regard to Ms. Potter, "I don't have any plans at the moment to make any changes," and said he had received expressions of support from G&J's German corporate parent and from his immediate boss, Axel Ganz, who repeated them to reporters.

In other G&J news, Child publisher Kate Kelly Smith is leaving the company to become vice president and publisher of Rodale's Prevention.

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