More than a dozen classaction lawsuits have been filed in U.S. Federal District Court in Phoenix on behalf of shareholders of Taser International against the Scottsdale-based stun gun maker.
The lawsuits were filed by law firms throughout the United States and could herald the beginning of a major judicial hearing against the manufacturer of the controversial, custom-made taser gun being used — and touted — by law enforcement agencies throughout the East Valley and across-the-country.
The suits basically claim that Taser International allegedly issued false and misleading statements about the safety of its guns.
As a result, shares of Taser stock dropped dramatically, according to the lawsuits.
In addition, the lawsuits filed in the Arizona court for shareholders by law firms in Little Rock, Ark., Coral Springs, Fla., Philadelphia, New York, Hartford, Conn., Baltimore, Boston and Atlanta accuse the company of making an end-of-year sale of $1.5 million in stun guns to meet projections for 2005.
The lawsuits claim that the sale resulted in a drop in Taser share values.
No Valley law firms were reported to have filed similar, class-action lawsuits.
Taser declined to comment on the lawsuits.
Taser International shares closed at $15.95 Monday, a drop of $1.33 per share or more than 7 percent from its previous value. Shares reached a high of $32.59 on Dec. 30, then plunged to $14.10 on Jan. 11, following reports of an investigation by the Securities and Exchange Commission into the company’s safety claims.
The court actions represent a growing list of criticisms fired at the company that was founded in 1993 by Phil Smith and is now being directed by his sons, Rick and Thomas Smith from its headquarters at 7860 E. McClain Drive, Scottsdale.
Among the latest accusations are a report from a Scottsdale research firm, Gradient Analytics. The report raises the question of credibility of one of Taser’s medical directors, Robert Stratbucker, who helped prepare an article about the stun gun’s safety.
The article, co-written by Stratbucker and published in the Pacing and Clinical Electrophysiology Journal, said the stun guns have "extremely low probability" of triggering ventricular fibrillation, or rapid, irregular contractions of the heart.
The Gradient report questioned the way the cardiac study was conducted and the validity of the conclusions. It said the study by Stratbucker and others was unrealistic to real-world situations, and did not, for example, consider factors such as drug use and heart disease.
"This (Gradient) report is worthless," said Stratbucker, 74, a research scientist with admitted financial interests in Taser and who was reached at his home in Omaha, Neb.
The Gradient report noted that "In the case of Dr. Robert Stratbucker, in particular, the evidence of bias is extremely compelling."
Stratbucker said his financial involvement with Taser had no influence on his objectivity. His neutrality and his experience were underscored and lauded by Taser spokesman Steve Tuttle.
"(Stratbucker) is widely viewed as an expert in the field of electrical safety, especially as it relates to stun devices," said Tuttle. "And we’re disappointed to see the debate on the safety of our life-saving technology shift from the scientific data to personal attacks on researchers."
Tuttle said he could not comment about the pending lawsuits.
Joe Blankenship, an account manager who tracks Taser stocks for potential Arizona buyers, said the lawsuits are not unusual.
"I suspect some of them don’t have any plaintiffs and the law firms are just asking for shareholders out there to join the lawsuit," said Blankenship. "I think these are nuisance lawsuits. It’s a way for law firms to make money."
Paul Bender, an attorney and Dean of the College of Law at Arizona State University, said class-action lawsuits filed in federal court by different, out-of-state law firms are usually combined into a single case.
"I would image that the chief judge will assign a single law firm to represent the shareholders and consolidate the lawsuits," said Bender.