Gov. Arnold Schwarzenegger said Friday that he would cancel his multimillion-dollar consulting contract with a publisher of health and bodybuilding magazines, amid complaints of a conflict of interest.
The announcement came a day after his top aide dubbed the controversy “much ado about nothing” and rejected calls for Schwarzenegger to end his relationship with American Media Inc. The company publishes Muscle & Fitness and Flex magazines, as well as the tabloids National Enquirer and the Globe…
Schwarzenegger’s office said the governor would not return money he had already been paid for the contract, which took effect Jan. 1, 2004. The staff would not reveal that amount, but the contract called for a minimum of $1 million a year. The office said Schwarzenegger would continue to write monthly columns for Muscle & Fitness and Flex, without a paycheck.
Margita Thompson, the governor’s spokeswoman, said he wouldn’t return the money from American Media because the contract was legal and appropriate.
The pact, formalized two days before the governor was sworn into office in November 2003, guaranteed, over five years, a minimum of $5 million, though the company estimated that the figure probably would be more than $8 million.
He also received an equity stake in the publishing firm, granting him a 1% portion from any sale of the company, or about $5.2 million under an estimate in the contract.