LOS ANGELES (CN) - In a derivative complaint in Superior Court, shareholders claim directors of People's Liberation clothing company used the company "as a piggy bank."
Plaintiff RP Capital sued People's Liberation and four of its directors or former directors - CEO Colin Dyne, Kenneth Wengrod, Susan White and Dean Oakey.
Referring to the nominal defendant company as PPLB, RP Capital claims: "In late 2005, the company executed a reverse merger into a shell corporation called Century Pacific United Corporation with the goal of building the company's brand name and share price and to obtain listing of the company on the NASDAQ. Instead, Dyne and the board of directors have used PPLB as a piggy bank, intentionally depressing the company's value, issuing millions of shares of company stock with little or no consideration, and paying themselves and other PPLB executives exorbitant salaries despite the poor overall performance of the company."
The plaintiff seeks reformation of the company's management structure, which it says is dominated by Dyne, and damages for self-dealing, breach of fiduciary duty, waste of corporate assets, gross mismanagement, abuse of control, and unjust enrichment.
It is represented by Byron T. Ball.