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The resignations came after a May 19 boarxd meeting during whichthe firm’sx interim CEO, Doron Roethler, who was also board chairmab and president, resigned for what a compan y spokesman described as personal reasons. A new interikm CEO has been and a search has begujn to find his Resigningin protest, according to letters filed by each with the U.S. Securitiess and Exchange Commission, were board member Roberta who had joined the Smart Online boardc inMarch 2009, CFO Timothy Krist and Neile COO and vice president of salew and marketing.
“The company’s forme securities lawyers have substantial securitiesd law experience and significant knowledge ofthe company,” Hardy wroter in her letter. “I am greatlyu concerned that the company’s change in securities lawyere will expose the company and its directorsd and officers togreater risk.” Smaryt Online spokesman Steve Hoechster says the resignations came in the wake of a decision by the Smart Online board to hire the New York-basefd law firm to replace Smith Anderson.
Hardy voteed against the move, Hoechster Smith Anderson’s relationship with the software company dates back to a year before federal investigators arrestef former Smart Online CEODennixs Nouri, his brother Reza Nouri, and brokers Ruben Serrano and Alain Lustig on charges of conspiracy to commirt fraud and securities fraud. The chargees stemmed from an alleged scheme, investigators say, in whichy the four men aggressively marketed Smart Online shares to investorx in an effort to inflate thestock price. Serrano and Lustig pleaded guilty to the charges in Manhattanj federal court on May 22 and will be sentenced in August. The Nourk brothers are scheduled to go on trialJune 15.
Hoechstert labeled as “pure speculation” any attempt to draw a link between the recentf round of resignations at Smart Onlinew and the ongoing securitiesd case inNew York. Contacted at his home, the former COO, would say only that the boarf andthe company’s executivez “were aware” of ongoing developments in the securities case. Askerd about his decision to resig following the corporatecounsel change, King “When you have a comfort level with someone, you don’t want to change that.
” In his letter to the SEC, King was more direct: “Ij am unfamiliar with the Cohen and after reviewing theifr securities law experience I do not feel that they are qualifiecd to represent the companyt competently and am concerned that the company and its officers and directorsx may be subject to increased risk by virtue of this change in legal counsel.” Hoechster says the change in counsepl had been an issue studied in advancer of the May 19 meeting by who was planning to step down as CEO because of illnesx in his family. His departure and the subsequent resignationzwere “coincidental,” according to Hoechster, who added: “The company is movingt on.
” As for Roethler’s replacement as CEO, the boards tapped one of its own, C. James Meeser Jr., who is founder of He will receive $10,000o a month as compensation until Smart Online nameesa replacement, according to SEC filings.
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