Hedge fund Aletheia Research & Management, which once owned one-sixth of Barnes & Noble Inc. (BKS) and stoked the bookseller's fears of a hostile takeover, has taken its stake below 5%, according to a filing with the Securities and Exchange Commission.

Its sales this week seems to erase any lingering hope that Aletheia, founded by Peter Eichler, will join any challenge to Barnes & Noble, and Chairman Leonard Riggio, should Barnes & Noble accept last month's $17-a-share offer to be acquired by John Malone's Liberty Media Corp. (LCAPA). A special committee of Barnes & Noble's board of directors, which doesn't include Riggio, is still evaluating the offer and has declined to comment until it makes a decision on the Liberty Media bid, which is contingent on Riggio contributing his nearly one-third stake and remaining with the company he spent decades building.

Aletheia last reported owning 3.2 million Barnes & Noble shares as of June 24, and Thursday's amended SC 13D filing shows Aletheia as the owner of less than 5% of Barnes & Noble stock. An appendix attached to the most recent filing shows sales of roughly 868,000 shares Monday and Tuesday, which would bring his stake to 2.4 million shares or just 3.9% of Barnes & Noble.

Billionaire Ron Burkle's Yucaipa Cos. owns nearly 20% of Barnes & Noble, recently adding to his stake at prices well above the $17 Liberty proposal. His stake is capped below 20% by a shareholder rights plan, or "poison pill," Barnes & Noble installed to prevent, via the threat of massive dilution, unwanted parties from taking control of it without paying a takeover premium.

The recent buying suggests Burkle, like some analysts, feels $17 is too low for the company as its nascent digital strategy begins to pay dividends. Barnes & Noble's Nook series of electronic-book readers, seen as the main interest of Liberty Media's Malone, has rapidly captured more than a quarter of the burgeoning e-book market, and is second only to Amazon.com Inc.'s (AMZN) popular Kindle e-readers, which boast most of the rest of the market share for downloadable books.

Burkle ran a competing slate of directors last year, hoping to oust Riggio and gain board representation, but failed, in part because Aletheia appears not to have voted most of its then-substantial holdings for Burkle and his two other nominees. Barnes & Noble justified the pill, and its opposition to the Burkle slate, by suggesting that Aletheia and Yucaipa could team up to seize control, but no evidence of a coordinated plan ever materialized.

Holders of less than 5% of a company, who aren't executives or board members and disclaim any potential corporate activism, need not disclose their positions, so it's unlikely we'll hear anything more about Aletheia's ownership, or any future sales, unless it boosts its stake above 5% again.

Eichler didn't respond to an email seeking comment.

Shares of Barnes & Noble, which traded as high as $21.06 early last week, closed down 2 cents at $16.58 apiece Thursday and were unchanged in light after-hours trading.

-By Maxwell Murphy, Dow Jones Newswires; 212-416-2171; maxwell.murphy@dowjones.com

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