P.M. BRIEFING : MiniScribe Files for Bankruptcy

MiniScribe Corp. said today that it has filed for protection from creditors under federal bankruptcy laws because it was “the only practical step” in light of a series of investor lawsuits the company faces.

The Longmont, Colo.-based maker of computer disk drives said it filed for Chapter 11 reorganization Monday in U.S. Bankruptcy Court in Denver. The move had been expected in the financial and business community because of the pending lawsuits.

The bankruptcy filing follows an internal report in September concluding that former senior managers of MiniScribe had “perpetrated a massive fraud” on the company over the past three years.

The report painted a picture of a company run amok under the direction of then Chief Executive Officer Q. T. Wiles, once known as the Dr. Fix It of the high-tech industry. Wiles resigned from the company last February.

Investor lawsuits allege that MiniScribe officials made “false and misleading statements” to artificially inflate the company’s stock.