Abercrombie & Fitch Co. Investigation On Behalf Of Former Employees
An investigation on behalf of former and current employees of Abercrombie & Fitch Co. (NYSE:ANF) concerning potential Employee Retirement Income Security Act (“ERISA”) breaches of fiduciary duty was announced.
Abercrombie & Fitch Co. (A&F) faces also an investigation on behalf of current long term investors concerning breaches of fiduciary duty in connection with its historical and present executive and office compensation practice at Abercrombie & Fitch and according to the investigation by a law firm under ERISA employees (former and current) of Abercrombie & Fitch Co. (NYSE:ANF) may be eligible to file a ERISA complaint for putting stock options at risk if they can prove their employer violated its fiduciary duty to them. Abercrombie & Fitch Co. (A&F) , located in New Albany, through its subsidiaries, is a specialty retailer that operates stores and direct-to-consumer operations selling casual sportswear apparel, including knit and woven shirts, graphic t-shirts, fleece, jeans and woven pants, shorts, sweaters, outerwear, personal care products, and accessories for men, women and kids under the Abercrombie & Fitch, abercrombie kids, and Hollister brands. The investigation by a law firm on behalf of current long term investors in Abercrombie & Fitch Co. (NYSE:ANF) focuses, among other things, on possible claims that certain of Abercrombie & Fitch’s officers and executives were unjustly enriched through their receipt of unwarranted, excessive or unearned compensation in past years.
Certain senior officers and executives at Abercrombie & Fitch Co. (NYSE:ANF), so the investigation, were awarded salaries, bonuses, stock options and other forms of long-term, ‘incentive’ or retirement compensation that might have been excessive or unwarranted based on the Abercrombie & Fitch’s performance as compared to what senior officers at comparable companies were making and/or results that were fraudulent, misleading or not long-lasting. Abercrombie & Fitch Co. reported on February 03, 2007 for the past 53weeks Total Revenue of $3.318.16billion, on February 02, 2008 for the past 52weeks $3.69966billion, on January 31, 2009 for the past 52weeks $3.48406billion, and on January 30, 2010 for the past 52weeks $2.928.63million. While Abercrombie & Fitchs’ revenue decreased over the past four years by over 10% or almost $400million its Net Income decreased from $422.19million in 2006 to a meager $0.25million in 2009. Shares of Abercrombie & Fitch Co. (Public, NYSE:ANF) traded during 2006 as low as $52.20 per share and as high as $77.39 per share. ANF shares continued to hold overall value during 2007 at about $80 per share, before during 2008 pluming to as low as $14.64 per share in November 2008. Since then ANF shares have recovered to recently $35.67 per share, but are currently still down from its current 52weekHigh of $51.12 per share.
While Abercrombie & Fitch Co. reported decreasing revenue and decreasing Net Income along with experiencing lower stock value, its CEO Michael S Jeffries, who runs the label since 1992, received in 2008 a 5year Compensation Total of $184.87 mil, or an average of almost $37million per year. In April 2010 Abercrombie & Fitch Co. announced in a SEC filing that it entered into an amendment to the employment agreement with its CEO Michael Jeffries to limit his unlimited personal use of Company aircraft. Previously, Mr. Jeffries was entitled to unlimited personal use. From 2006 to 2008, he booked an average of about $850,000 a year worth of personal travel on the corporate jet. In 2008 alone, he tallied roughly $1.1 million worth of personal travel on the jet. In exchange for agreeing to the limitations, Mr. Jeffries will receive a lump-sum payment of $4 million from Abercrombie & Fitch Co. In May 2010, Abercrombie and Fitch announced that the Fiscal 2009 total compensation for Mr. Jeffries was $36.3million.