Lawsuit Alleges Oakley Misled Investors

A Pennsylvania investor has sued sunglasses maker Oakley Inc., claiming the company, its officers, directors and underwriters misled investors about the company’s prospects in a secondary stock offering. The suit, filed in District Court in Los Angeles by investor Val Fichera, seeks class-action status for investors who bought Oakley shares in the June 6, 1996 offering.

Investors such as Fichera paid $47.63 a share in the offering. The stock later split 2 for 1. Oakley shares plunged later that year when sales to its largest customer, Florida-based Sunglass Hut International, stalled. The stock closed Monday at $9.06 a share, down 25 cents, on the New York Stock Exchange.

The only sellers in the stock offering were Oakley’s two top officers. Chairman Jim Jannard sold 9 million shares, netting $205.2 million. Chief Executive Mike Parnell sold 1 million shares, netting $22.8 million. Merrill Lynch & Co. and Alex. Brown & Sons underwrote the offering.

Jannard described the suit as “a desperate attempt by plaintiffs’ counsel to add credence to unproven allegations. We will vigorously defend ourselves against these meritless claims.”

The suit is the second such action filed against Oakley over the offering, said Vermont attorney Dennis J. Johnson, who filed the case. Last month, Kensington Capital Management filed a similar case that also seeks class-action status. Kensington is seeking unspecified damages.