Kid Brands Announces Putative Stockholder Derivative Complaint
On May 20, 2011, Kid Brands, Inc. (NYSE: KID) became aware that a putative stockholder derivative complaint had been filed by the City of Roseville Employees' Retirement System in the United States District Court of the District of New Jersey, against Bruce G. Crain, the Company's CEO, Guy A. Paglinco, the Company's CFO, Marc Goldfarb, the Company's Senior Vice President and General Counsel, each member of the Company's current Board of Directors, and John Schaefer, a former member of the Company's Board of Directors. In addition, the Company has been named as a nominal defendant.
The complaint alleges, among other things, that the Defendants breached their fiduciary duties to the Company by allegedly failing to implement an internal controls system for compliance with US Customs laws for imported goods and applicable local foreign laws, and issuing false and misleading public statements about the Company's related party transactions with the former owners of its LaJobi subsidiary, all in violation of state law. In addition, the complaint alleges that such failures also constitute gross mismanagement, abuse of control and commission of corporate waste and resulted in unjust enrichment.
The complaint seeks monetary damages against the individual Defendants in an unspecified amount together with interest, in addition to exemplary damages, the costs and disbursements of the lawsuit, including attorneys' and experts' fees and costs, and such equitable relief as the court deems just and proper.
The Company has notified its insurance carriers of such complaint. While the Company will incur costs in connection with the defense of this lawsuit, the lawsuit does not seek monetary damages against the Company.
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.