Intersil Shareholder Sues Over Large Stock Sale

A shareholder in Irvine computer-chip maker Intersil Corp. filed a lawsuit contending that Harris Corp., a military radio and cellular telephone system maker, improperly sold Intersil stock for an $8.8 million profit.

Aron Rosenberg, in a suit filed last week in federal court in Delaware, says Melbourne, Fla.-based Harris bought more than 8,000 shares of Intersil preferred stock in 1999. The shares were converted to about 500,000 shares of common stock after Intersil’s $25 per-share initial public offering in February 2000, the suit says.

Rosenberg contends Harris violated an agreement not to sell its stock without written approval from other major common shareholders when it sold about 235,000 shares in August 2000.

“The price of the stock continued to rise, reaching $67 within six months [and] allowing Harris to profit handsomely,” Rosenberg contends in the suit, which seeks to have Harris relinquish the $8.8 million in profits.

Harris is reviewing the suit, spokesman Tom Hausman said. “We believe it’s baseless and we will vigorously defend that position,” he added.

The stock closed Thursday at $37.96, up 40 cents a share, on Nasdaq.