Embezzlement Charge Renewed Against Firm

A second amended complaint alleging violation of federal securities laws was filed July 8 in U. S. District Court against With Design in Mind International Inc., a Woodland Hills maker of toys and novelty gift items, the company said.

The action represents an attempt to keep alive a recently dismissed shareholder class-action suit that alleges securities violations stemming from the suspected embezzlement of $2.1 million from the company by former company executives.

Three former executives were ousted from the company two years ago and later settled a complaint brought by the company by agreeing to pay about $1 million, mostly in cash and stock. The former executives did not admit or deny any wrongdoing.

Subsequently, two shareholders filed a class-action complaint against the company, seeking the right to rescind their purchases of the company’s stock, as well as unspecified damages. The shareholder complaint had already been amended once when it was dismissed by the court on May 24 this year, but the plaintiffs were given 45 days to submit a second amended complaint.

In a prepared statement, the company said it “intends to continue to vigorously defend itself in this matter.”

The company, which has been restructuring since late 1992, posted a loss of $509,922 on revenue of $294,900 for the first quarter ended March 31.