DALLAS (CN) - During its IPO, corporate insiders at Heelys made more than $79 million by dumping shares at prices inflated by false statements and concealment of a slew of reports of children injured by the wheeled shoes, and the resulting inability to sell inventory, an investor claims in Dallas County Court.
Plaintiff Carol Dick says she lost $11 million by investing in Heelys stock.
Dick says Heelys and its directors reaped $155 million during the December 2006 IPO, at $21 a share. She claims the insiders dumped their shares at this elevated price that month, and that William Thomas made $33.4 million from it, Roger Adams made $26.3 million, Richard Middlekauf made $12.4 million, CEO Michael Staffaroni made $4 million, Michael Hessong made $2 million, and Samuel Ligon made $1.7 million.
Dick says she bought more than 600,000 shares of Heelys for about $17.4 million. She claims that CEO Staffaroni admitted the problems with safety and excessive inventory in a conference call on Aug. 7, 2007, and the next day the share price dropped by nearly 50 percent. Today it's selling for around $4 a share.
She demands $11 million. She is represented by Mark Werbner with Sayles Werbner.
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