Risk Management

At BlueRay, Ex-CFO Sues to Make Finances Public

The former exec, fired for not telling the private company of her legal problems, wants BlueRay to disclose financial records.
Stephen TaubApril 28, 2008

A former BlueRay Technologies Inc. finance chief, fired last year in part for not disclosing prior legal problems, is suing the company to make it disclose financial records, BlueRay said in court papers filed last week.

The former finance official, Yelena Simonyan, is suing as a shareholder, according to a report in The Spokesman-Review.

The privately-held company that makes blue-ray discs claims that Simonyan is seeking the records and suing as a way of influencing BlueRay’s buyout of her stock.

An attorney for Simonyan, Daniel Gibbons, of the firm of Pain Hamblen Coffin Brooke & Miller, declined to comment to CFO.com on the case, and the newspaper said he cited an agreement with BlueRay not to speak. BlueRay officials couldn’t immediately be reached for comment on the report, although the Spokane, Wash., paper said that BlueRay CEO and President Eric Hansen had declined to comment.

Earlier this month, Simonyan sued the company claiming that she had invested $100,000, according to an earlier report in the paper. She claimed that the company did not maintain or offer certain records as required by state law, and said that a balance sheet that she had seen was “out of balance” by $4 million, according to the report. The paper noted that a court commissioner agreed to BlueRay’s request to seal parts of the court record.

The company claims it has complied with all records requests, except for turning over a stock register and certain accounting records, according to the Spokane paper.

BlueRay reportedly asked the Spokane County Superior Court to dismiss the former finance executive’s lawsuit and restrict disclosure of accounting records and its stock register.

Back in October, Simonyan was fired as CFO for not disclosing that in 2001 she was sentenced to three years of probation and fined $3,000 after pleading guilty to conspiracy to defraud the Internal Revenue Service. CEO and President Erick Hansen also reportedly fired her for alleged “failure to properly maintain corporate records and accounts.”

Hansen also reportedly claims a potential investor group backed out after discovering the conviction during background checks.

The company also is seeking damages for the alleged wrongful disclosure of confidential documents, and for recovery related to the company’s not having been told of Simonyan’s legal problems.

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