SAN DIEGO and SALT LAKE CITY, Nov. 19, 2012 /PRNewswire/ -- Shareholder rights firm Robbins Umeda LLP is investigating possible breaches of fiduciary duty and other violations of the law by certain officers and directors at ZAGG Inc. (NASDAQ-GS: ZAGG).
Robbins Umeda LLP is investigating allegations that ZAGG's founder and former Chief Executive Officer, Robert G. Pedersen II, made secret collateral pledges with his company stock. Allegedly, due to Mr. Pedersen's actions, ZAGG's board of directors transferred the day-to-day management of ZAGG from Mr. Pedersen to Randall L. Hales without informing the public. In December 2011, the ZAGG board of directors discovered that Mr. Pedersen had pledged a substantial amount of his company stock, constituting more than 50% of his stake in the company, as collateral on margin calls. After learning this fact, the board of directors initiated a secret plan to remove Mr. Pedersen as CEO and to appoint Mr. Hales as his successor. Despite the creation of the succession plan, on April 27, 2012, ZAGG filed a Proxy Statement with the U.S. Securities and Exchange Commission that failed to disclose that Mr. Pedersen was no longer running the company and that he had pledged a substantial amount of his personally held company stock as collateral.
On August 17, 2012, ZAGG disclosed that Mr. Pedersen had "stepped down as CEO and Chairman," effective immediately. It was also revealed that Mr. Pedersen had resigned after selling 515,000 shares of ZAGG common stock on August 14, 2012, at prices ranging between $8.10 and $8.43, to meet margin calls. On August 28, 2012, in a conference call, ZAGG revealed that Mr. Pedersen had sold an additional 1.2 million shares of ZAGG stock to meet margin requirements. Additionally, this conference call informed the investing public that Mr. Hales had been installed as ZAGG's President and Chief Operating Officer in December 2011, when the Board first discovered Mr. Pedersen's "margin call situation," well before Mr. Pedersen's resignation.
Robbins Umeda LLP highlights that ZAGG shareholders have the option to pursue a shareholder derivative action, through which shareholders aim to hold insider wrongdoers accountable for their actions, prevent future misconduct, and bring long-term value back to the company. Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, firstname.lastname@example.org, or via the shareholder information form on the firm's website.
Robbins Umeda LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested. For more information, please go to http://www.robbinsumeda.com.
Press release link: http://www.robbinsumeda.com/shareholders-rights-blog/zagg-inc/
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SOURCE Robbins Umeda LLP