FORT LAUDERDALE (CN) - The two men who run Learn.com cheated the company by granting the company COO $1.9 million in loans and 1.4 million stock options, then letting him buy the shares at far less than called for, Scottie Pippen claims in a shareholders class action.
The class action in Broward County Court does not indicate whether the named plaintiff is the famous Chicago Bulls basketball player, though that Scottie Pippen lives in Fort Lauderdale.
Pippen says he bought 500,000 shares of Learn.com in 2002 at $1 a share.
He says defendant James Riley, sole director of the company in 2001, hired J.W. Ray as senior vice president that year.
Pippen claims Ray was given the option to buy 1.1 million shares for 25 cents apiece, but paid only 5 cents apiece for them.
He says Ray was given another option to buy 300,000 more shares for $1 apiece, but paid only 25 cents apiece for them.
He claims the company loaned Ray $305,000 "without any adequate consideration," and that "the loan can be forgiven at any time."
He claims the company loaned another $1.6 million to a company Ray controls, under the same loose terms.
And he claims Learn.com refused his reasonable request to see books and records.
On its Web site, Learn.com describes itself as "the leading provider of workforce development and productivity solutions through a Software-as-a-Service ('SaaS') business model." The Web site lists Riley as president and CEO and Ray as executive VP and COO.
Pippen is represented by Richman Greer of West Palm Beach.
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