| Fashion News Colorado |
Fashion With A Heart
Contributed by: Heather Spencer on 12/3/2007
The young, the groovy, and the fashionable began pouring in to the annual MAX fashion show around 8:30 p.m. last Saturday. The air was thick
with style and attitude. Whether the paying customers knew it or not, they were contributing to much more than a seat at a fashion show - they
were helping women and children stay safe and become self-reliant.
The scene's become a tradition for Max Martinez, proprietor of MAX Clothing Stores throughout Colorado. For the past 20 years MAX has
thrown a fashion extravaganza benefiting various charities around town, and for the past four years it's been the Volunteers of America Brandon
Center. This year brought over 700 guests to the show and more money to Brandon Center than ever before. The Brandon Center is Colorado's
largest shelter for women and children who are homeless or are escaping domestic violence. The Center is a safe and stable environment for over 90
guests every night, and provides resources for the women to attain self-sufficiency.
Thanks to Martinez and his staff in Denver, Boulder, and Aspen, over $150,000 will be donated to the women's shelter, providing food, basic
necessities, one on one counseling, GED training and life skills classes.
Fit on Fox: Fashion Show Benefits Breast Cancer Fund
Last Edited: Tuesday, 11 Dec 2007, 2:36 PM MST
Created: Tuesday, 11 Dec 2007, 2:20 PM MST
Fit on Fox graphic SideBar
Breast cancer has changed their lives, but not their spirits.
Some very brave, inspirational women will model LuLulemon athletic apparel at a shopping event this weekend.
Some of them appeared with certified fitness instructor on Good Day Colorado Tuesday morning.
They will be participating in the LUNAFEST "Function as Fashion" show where a portion of the proceeds will benefit the Breast Cancer Fund.
It's an event where you can shop for the holiday season and give to a great cause at the same time.
Coming to Aspen's Isis: fashion, art
Carolyn Sackariason
Aspen, CO Colorado
December 11, 2007
ASPEN — The two retail spaces in the Isis Theatre are officially spoken for.
Leases have been signed by the operators of a women’s clothing store and a photo gallery. The Aspen City Council this week signed off on
sublease agreements with the Isis Retail Group and Peter Lik, a photographer who will show his works in one space, and Vanessa Kirianoff, owner
of Blu Phoenix, a contemporary women’s clothing store, in the other half of the building.
Earlier this year City Hall financed the purchase of the historic theater and allowed one of the five screens to be converted into retail space that
would be leased by the Isis Property Group, a group of investors who were going to purchase the theater before the city stepped in.
The city of Aspen owns the Isis building and leases the retail space to Courtney Lord, who heads the retail group. Aspen Film leases the theater
portion of the building and leases it Rocky Mountain Resort Cinemas. Per an agreement with the city, both local organizations have a right to own
the spaces in 30 years, according City Finance Director Paul Menter.
Lord has been responsible for paying rent to City Hall since the deal closed in February. But since the retail spaces have been under construction
for the past 10 months, Lord has had to buck up about $300,000 in rent to the city.
Construction is scheduled to be complete this month and Lord is hoping his new tenants will have no further delays.
“We’ll be happier when we get them open,” he said.
Kirianoff, 24, said she plans to open by the end of this week, possibly just in time for the Dec. 15-16 weekend.
Operating under the corporation Verve LLC., Blu Phoenix will offer leather coats, cashmere, tops, slacks, denim jeans and jewelry. Kirianoff, an old
Snowmass resident, describes the clothing as moderately to high priced.
“I have the locals in mind,” she said. “My friends said buy things that we can buy.”
Lik, an Australian photographer, will add Aspen to his growing list of cities where he has galleries — 14 in total — New York, Las Vegas, Florida,
Hawaii, Colorado and Austrailia.
He began with specialized panoramic postcards and ventured into small hardcover books, which have become his trademark. His galleries sell
limited editions of his work, and include scenic prints and celebrity photos. Prices for his works can reach into the thousands of dollars.
When the city of Aspen, the investor group and Aspen Film entered into the partnership, it was stipulated that the retail space be mid-level in
pricing. While neither operator’s model indicates mid-level prices, locals and visitors will determine the cost threshold through their shopping
habits.
Kirianoff said the space, which she first eyed three months ago, is strategically located in a heavily-traveled pedestrian area and near upscale shops
in the Brand Building.
“In Aspen it’s important to have a space you believe in and this is a great location,” she said, adding she has a five-year lease with an option to
renew for two years. “The opportunity came together in September and I jumped on it.”
Verve LLC is funded by a group of local investors and Kirianoff will have the option of buying 100 percent of the company when it turns a profit,
which she expects to do within a couple of years.
The store is the first business for Kirianoff, who grew up between Los Angeles and Aspen. She has worked in the fashion merchandising industry
since she graduated from the University of Southern California in photography and design.
Kirianoff said she’s bought most of her merchandise in LA, and plans to purchase clothing and jewelry that is unique to Aspen.
“I want to bring some brands in that aren’t in Aspen,” she said, adding she hopes to offer high-end jewelry in the future and possibly some men’s
apparel. Whatever she buys, Kirianoff wants locals to be satisfied.
“In the world of Aspen the word ‘local’ is disappearing,” she said. “This store is financed by locals and run by locals.”
Taking stock of Crocs
Niwot shoemaker saw highs, lows in 2007
By Alicia Wallace (Contact)
Monday, December 17, 2007
Diane Czarkowski shops for Crocs last week at Pedestrian Shops in Boulder.
One way to describe Crocs Inc.'s 2007 would be "colorful."
And depending on who's asked, that could either be good — or bad.
After a year of highs and lows, the Niwot-based company's chief executive and some analysts expect the shoemaker to remain swift-footed in its
growth plans. At the same time, other observers wonder whether recent events are foretelling of future troubles.
Through the first 10 months of the year, Crocs expanded its reach, broadened its offerings and — much like it has done since executing its initial
public offering — continued to wow Wall Street with its earnings.
"We are one of the most, if not the most, exciting brands out there," says Ron Snyder, Crocs' chief executive officer.
Most recently, though, investors' feelings about the stock took a turn after Crocs (Nasdaq: CROX) reported its third-quarter earnings. After the
Oct. 31 release, some investors appeared to be spooked by lower-than-expected projections, rising inventory levels and potential lost sales due to
distribution issues.
The stock price dropped 36 percent the next day.
In the weeks after the Crocs stock shock, five class action lawsuits were filed in U.S. District Court in Colorado.
"The significant decline in sales confirmed for many that the company's plastic water shoes had seen their day and reality was beginning to set in,"
Denver attorney Jeffrey M. Villanueva wrote in one of those lawsuits, filed Nov. 26.
Crocs also has seen imitation shoes pop up on store shelves, leading the company to file lawsuits to protect its brand.
This year, those patent lawsuits have not been resolved. Ongoing disputes before the International Trade Commission include allegations that
Crocs didn't invent its ubiquitous rubber footwear — which has made shareholders and executives millions and should garner the company more
than $800 million in sales for the year.
Continuing to rock
Crocs kicked off 2007 by signing licensing agreements with the NFL and NHL. Additional agreements — with Marvel, Warner Bros., chef Mario
Batali and others — soon followed.
In a couple short years, Crocs has grown to fill five buildings in Niwot. Locally, nearly 500 people work for the company. Globally, it's about
5,700.
Its classic Beach and Cayman models have more than 110 siblings, including Cleo, Alice, Mary Jane, Georgie and the increasingly popular synthetic
and fleece-lined Mammoth.
Crocs also has gone chic with its high-fashion YOU by Crocs line, covered more than just feet with a new apparel line, and spread its wings by
buying companies that make items such as sandals, golf shoes, hockey equipment and bicycle seats.
The Crocs-owned Jibbitz accessories line currently is selling in about 80 countries, company officials say.
The growth "has exceeded our expectations," Snyder says, attributing the expansion to new offerings and international expansion.
Sitting in a room filled with Crocs in all shapes, sizes, colors and styles, Snyder smiles and shoots his eyes around the room when asked about one
early concern from industry observers: Crocs was a one-shoe company.
"Guilty as charged," Snyder says. "If you look around the industry, some of the most successful companies out there started with one shoe. ...We
have taken the success of the product and significantly invested it back into the business."
Snyder says the company has successfully diversified itself, noting its YOU by Crocs lines as prime examples. The raised-heel shoes with Crocs'
Croslite material in their soles marked Crocs' entry into the high-fashion women's shoe sector.
"There's more than just Crocs these days," he says.
And some people appear to be eating that up. Crocs enthusiast Richard Polk, an early company shareholder and Boulder shoe store owner, says
his Pedestrian Shops sold more than 75 pairs of the YOU shoes in a month's time. Considering the price range of about $150 to $300, "it's pretty
extraordinary," Polk says.
The plunge
But other storylines played out amidst Crocs' strides in 2007, and those included the company's shoes being accused of causing static electricity
that incapacitated medical equipment, and contributing to escalator injuries.
Then there were the patent disputes.
While a couple of the 11 lawsuits have been settled, the wrangling between Crocs and other shoemakers is playing out in federal court and the
International Trade Commission.
Most of the documents in the ITC case remain under seal, but public documents reveal Crocs' battle to protect two patents and other companies'
responses that include claims that their shoes use different materials, have unique designs and that Crocs' patents are invalid because the shoe
allegedly was invented by Ettore Battiston, not Crocs co-founder Scott Seamons.
In a Sept. 11 deposition, Seamons said he was aware of a "Battiston Aqua Clog," a strapless closed-cell resin shoe sold in 2001. Seamons told
Crocs' patent attorneys he knew about the clogs' sale in the U.S. since 2001, but did not notify the Patent and Trademark Office, according to the
ITC deposition.
Like most corporations, Crocs has a company policy not to comment on ongoing litigation. In response to the ongoing patent lawsuits, Snyder
says Crocs continues "to vigorously defend our (intellectual property) in all markets around the world."
Snyder says he feels confident that Crocs is taking strides to battle companies that have launched copycat shoes.
"We're happy to say that customers recognize the difference with our shoes," he says, adding that, "We're coming up with so many new models,
it's hard for somebody knocking us off to keep up."
The diversity in models doesn't mean the competition is going to go away, said Marshal Cohen, a chief industry analyst who follows retail and
consumer trends for The NPD Group.
Come springtime, companies like Skechers will continue to sell a similar-looking shoe to Crocs' classic models, he says.
"If the shoes still sell, they'll be on it like the hottest thing since sliced bread," Cohen says.
Class action
Crocs' legal battles multiplied last month with the filing of five class action suits against the company and its executives.
The first filing came seven days after Crocs' stock plummeted 36 percent to $47.74 from $74.75. At issue were third-quarter sales that fell slightly
under expectations, full-year projections that were under estimates and statements relayed by Crocs executives about an inventory build-up
overseas that contributed to the potentially loss of $30 million in sales.
The lawsuits allege the shareholders who purchased shares during the July 27 to Oct. 31 period were mislead by prior positive statements made by
executives about successful global expansion, and were damaged as a result because the price of the stock was artificially inflated during the quarter.
The allegations go further, claiming that some of Crocs' executives and directors profited off the "artificially inflated" prices, according to the suits.
One suit that names Crocs, Snyder and chief financial officer Peter Case as defendants claims they participated in a "fraudulent scheme."
The "scheme" was to deceive the investing public regarding Crocs' business and its stock value; to enable insiders to sell nearly 1 million shares of
stock to generate proceeds of $58 million; and to cause shareholders to purchase the stock at inflated prices, wrote Denver-based attorney Jeffrey
Allen Berens in a suit filed Nov. 8.
Crocs officials deny the accusations.
"We believe the claims are without merit and we intend to vigorously defend the lawsuits," Snyder says.
The class action suits shouldn't be much more than an annoyance to Crocs, says Elizabeth Montgomery, senior research analyst with N.Y.-based
Cowen and Company LLC.
But Crocs shouldn't expect a resolution in a matter of months, says Christopher Mueller, a University of Colorado law professor. During that time,
a consolidation of the suits should take place, he says. A settlement could be reached before anything goes to trial, he says, noting that would
depend on not only the merits of the accusations, but the company's willingness for an ongoing battle.
"I'm sure a great many companies pay out dollars because they appraise the risks and say, 'Well, we might win this, but if we lose, the liability will
be so much more horrendous than it is to pay out,'" Mueller says.
Full steam ahead
Despite the bumps, Crocs is hardly bruised, says analyst Reed Anderson, of D.A. Davidson & Co.
"I still think this is a very good business. This is a very profitable business," Anderson says. "They're very young. It's gone from nothing to almost
over $800 million in four years."
Anderson's firm initiated coverage on Crocs a month ago. In its disclosure statement, D.A. Davidson says it expects to receive or intends to seek
compensation for investment banking services from Crocs. Its analysts are not directly compensated for involvement in certain banking
transactions.
Robert W. Baird & Co. analyst Mitch Kummetz wrote in a recent research note that he views the Crocs glass as "half-full." Noting Crocs plans to
expand to retailers such as Foot Locker, Kummetz has an "outperform" rating on the stock.
"In a few years, CROX has accomplished what a really successful footwear brand might achieve in 10 or 20 years," he wrote. Robert W. Baird
maintains a trading market in Crocs' stock.
It's yet to be seen whether third-quarter inventory troubles are the effect of seasonality or if the core business is slowing down, says Cowen's
Montgomery, who does not own shares of Crocs.
However, NPD's Cohen says he doesn't think Crocs has broken out of its mold yet. The YOU shoes "didn't even make a ripple in the bucket" in
the rest of the retail world, he says, adding that the brand needs to stand for something on its own — something other than just foam-like shoes
with holes in them.
"The hourglass is starting to run out of some sand here," the analyst says. "The longer you wait, the less opportunistic the timing is going to be in
their favor."
Contributed by: Heather Spencer on 12/3/2007
The young, the groovy, and the fashionable began pouring in to the annual MAX fashion show around 8:30 p.m. last Saturday. The air was thick
with style and attitude. Whether the paying customers knew it or not, they were contributing to much more than a seat at a fashion show - they
were helping women and children stay safe and become self-reliant.
The scene's become a tradition for Max Martinez, proprietor of MAX Clothing Stores throughout Colorado. For the past 20 years MAX has
thrown a fashion extravaganza benefiting various charities around town, and for the past four years it's been the Volunteers of America Brandon
Center. This year brought over 700 guests to the show and more money to Brandon Center than ever before. The Brandon Center is Colorado's
largest shelter for women and children who are homeless or are escaping domestic violence. The Center is a safe and stable environment for over 90
guests every night, and provides resources for the women to attain self-sufficiency.
Thanks to Martinez and his staff in Denver, Boulder, and Aspen, over $150,000 will be donated to the women's shelter, providing food, basic
necessities, one on one counseling, GED training and life skills classes.
Fit on Fox: Fashion Show Benefits Breast Cancer Fund
Last Edited: Tuesday, 11 Dec 2007, 2:36 PM MST
Created: Tuesday, 11 Dec 2007, 2:20 PM MST
Fit on Fox graphic SideBar
Breast cancer has changed their lives, but not their spirits.
Some very brave, inspirational women will model LuLulemon athletic apparel at a shopping event this weekend.
Some of them appeared with certified fitness instructor on Good Day Colorado Tuesday morning.
They will be participating in the LUNAFEST "Function as Fashion" show where a portion of the proceeds will benefit the Breast Cancer Fund.
It's an event where you can shop for the holiday season and give to a great cause at the same time.
Coming to Aspen's Isis: fashion, art
Carolyn Sackariason
Aspen, CO Colorado
December 11, 2007
ASPEN — The two retail spaces in the Isis Theatre are officially spoken for.
Leases have been signed by the operators of a women’s clothing store and a photo gallery. The Aspen City Council this week signed off on
sublease agreements with the Isis Retail Group and Peter Lik, a photographer who will show his works in one space, and Vanessa Kirianoff, owner
of Blu Phoenix, a contemporary women’s clothing store, in the other half of the building.
Earlier this year City Hall financed the purchase of the historic theater and allowed one of the five screens to be converted into retail space that
would be leased by the Isis Property Group, a group of investors who were going to purchase the theater before the city stepped in.
The city of Aspen owns the Isis building and leases the retail space to Courtney Lord, who heads the retail group. Aspen Film leases the theater
portion of the building and leases it Rocky Mountain Resort Cinemas. Per an agreement with the city, both local organizations have a right to own
the spaces in 30 years, according City Finance Director Paul Menter.
Lord has been responsible for paying rent to City Hall since the deal closed in February. But since the retail spaces have been under construction
for the past 10 months, Lord has had to buck up about $300,000 in rent to the city.
Construction is scheduled to be complete this month and Lord is hoping his new tenants will have no further delays.
“We’ll be happier when we get them open,” he said.
Kirianoff, 24, said she plans to open by the end of this week, possibly just in time for the Dec. 15-16 weekend.
Operating under the corporation Verve LLC., Blu Phoenix will offer leather coats, cashmere, tops, slacks, denim jeans and jewelry. Kirianoff, an old
Snowmass resident, describes the clothing as moderately to high priced.
“I have the locals in mind,” she said. “My friends said buy things that we can buy.”
Lik, an Australian photographer, will add Aspen to his growing list of cities where he has galleries — 14 in total — New York, Las Vegas, Florida,
Hawaii, Colorado and Austrailia.
He began with specialized panoramic postcards and ventured into small hardcover books, which have become his trademark. His galleries sell
limited editions of his work, and include scenic prints and celebrity photos. Prices for his works can reach into the thousands of dollars.
When the city of Aspen, the investor group and Aspen Film entered into the partnership, it was stipulated that the retail space be mid-level in
pricing. While neither operator’s model indicates mid-level prices, locals and visitors will determine the cost threshold through their shopping
habits.
Kirianoff said the space, which she first eyed three months ago, is strategically located in a heavily-traveled pedestrian area and near upscale shops
in the Brand Building.
“In Aspen it’s important to have a space you believe in and this is a great location,” she said, adding she has a five-year lease with an option to
renew for two years. “The opportunity came together in September and I jumped on it.”
Verve LLC is funded by a group of local investors and Kirianoff will have the option of buying 100 percent of the company when it turns a profit,
which she expects to do within a couple of years.
The store is the first business for Kirianoff, who grew up between Los Angeles and Aspen. She has worked in the fashion merchandising industry
since she graduated from the University of Southern California in photography and design.
Kirianoff said she’s bought most of her merchandise in LA, and plans to purchase clothing and jewelry that is unique to Aspen.
“I want to bring some brands in that aren’t in Aspen,” she said, adding she hopes to offer high-end jewelry in the future and possibly some men’s
apparel. Whatever she buys, Kirianoff wants locals to be satisfied.
“In the world of Aspen the word ‘local’ is disappearing,” she said. “This store is financed by locals and run by locals.”
Taking stock of Crocs
Niwot shoemaker saw highs, lows in 2007
By Alicia Wallace (Contact)
Monday, December 17, 2007
Diane Czarkowski shops for Crocs last week at Pedestrian Shops in Boulder.
One way to describe Crocs Inc.'s 2007 would be "colorful."
And depending on who's asked, that could either be good — or bad.
After a year of highs and lows, the Niwot-based company's chief executive and some analysts expect the shoemaker to remain swift-footed in its
growth plans. At the same time, other observers wonder whether recent events are foretelling of future troubles.
Through the first 10 months of the year, Crocs expanded its reach, broadened its offerings and — much like it has done since executing its initial
public offering — continued to wow Wall Street with its earnings.
"We are one of the most, if not the most, exciting brands out there," says Ron Snyder, Crocs' chief executive officer.
Most recently, though, investors' feelings about the stock took a turn after Crocs (Nasdaq: CROX) reported its third-quarter earnings. After the
Oct. 31 release, some investors appeared to be spooked by lower-than-expected projections, rising inventory levels and potential lost sales due to
distribution issues.
The stock price dropped 36 percent the next day.
In the weeks after the Crocs stock shock, five class action lawsuits were filed in U.S. District Court in Colorado.
"The significant decline in sales confirmed for many that the company's plastic water shoes had seen their day and reality was beginning to set in,"
Denver attorney Jeffrey M. Villanueva wrote in one of those lawsuits, filed Nov. 26.
Crocs also has seen imitation shoes pop up on store shelves, leading the company to file lawsuits to protect its brand.
This year, those patent lawsuits have not been resolved. Ongoing disputes before the International Trade Commission include allegations that
Crocs didn't invent its ubiquitous rubber footwear — which has made shareholders and executives millions and should garner the company more
than $800 million in sales for the year.
Continuing to rock
Crocs kicked off 2007 by signing licensing agreements with the NFL and NHL. Additional agreements — with Marvel, Warner Bros., chef Mario
Batali and others — soon followed.
In a couple short years, Crocs has grown to fill five buildings in Niwot. Locally, nearly 500 people work for the company. Globally, it's about
5,700.
Its classic Beach and Cayman models have more than 110 siblings, including Cleo, Alice, Mary Jane, Georgie and the increasingly popular synthetic
and fleece-lined Mammoth.
Crocs also has gone chic with its high-fashion YOU by Crocs line, covered more than just feet with a new apparel line, and spread its wings by
buying companies that make items such as sandals, golf shoes, hockey equipment and bicycle seats.
The Crocs-owned Jibbitz accessories line currently is selling in about 80 countries, company officials say.
The growth "has exceeded our expectations," Snyder says, attributing the expansion to new offerings and international expansion.
Sitting in a room filled with Crocs in all shapes, sizes, colors and styles, Snyder smiles and shoots his eyes around the room when asked about one
early concern from industry observers: Crocs was a one-shoe company.
"Guilty as charged," Snyder says. "If you look around the industry, some of the most successful companies out there started with one shoe. ...We
have taken the success of the product and significantly invested it back into the business."
Snyder says the company has successfully diversified itself, noting its YOU by Crocs lines as prime examples. The raised-heel shoes with Crocs'
Croslite material in their soles marked Crocs' entry into the high-fashion women's shoe sector.
"There's more than just Crocs these days," he says.
And some people appear to be eating that up. Crocs enthusiast Richard Polk, an early company shareholder and Boulder shoe store owner, says
his Pedestrian Shops sold more than 75 pairs of the YOU shoes in a month's time. Considering the price range of about $150 to $300, "it's pretty
extraordinary," Polk says.
The plunge
But other storylines played out amidst Crocs' strides in 2007, and those included the company's shoes being accused of causing static electricity
that incapacitated medical equipment, and contributing to escalator injuries.
Then there were the patent disputes.
While a couple of the 11 lawsuits have been settled, the wrangling between Crocs and other shoemakers is playing out in federal court and the
International Trade Commission.
Most of the documents in the ITC case remain under seal, but public documents reveal Crocs' battle to protect two patents and other companies'
responses that include claims that their shoes use different materials, have unique designs and that Crocs' patents are invalid because the shoe
allegedly was invented by Ettore Battiston, not Crocs co-founder Scott Seamons.
In a Sept. 11 deposition, Seamons said he was aware of a "Battiston Aqua Clog," a strapless closed-cell resin shoe sold in 2001. Seamons told
Crocs' patent attorneys he knew about the clogs' sale in the U.S. since 2001, but did not notify the Patent and Trademark Office, according to the
ITC deposition.
Like most corporations, Crocs has a company policy not to comment on ongoing litigation. In response to the ongoing patent lawsuits, Snyder
says Crocs continues "to vigorously defend our (intellectual property) in all markets around the world."
Snyder says he feels confident that Crocs is taking strides to battle companies that have launched copycat shoes.
"We're happy to say that customers recognize the difference with our shoes," he says, adding that, "We're coming up with so many new models,
it's hard for somebody knocking us off to keep up."
The diversity in models doesn't mean the competition is going to go away, said Marshal Cohen, a chief industry analyst who follows retail and
consumer trends for The NPD Group.
Come springtime, companies like Skechers will continue to sell a similar-looking shoe to Crocs' classic models, he says.
"If the shoes still sell, they'll be on it like the hottest thing since sliced bread," Cohen says.
Class action
Crocs' legal battles multiplied last month with the filing of five class action suits against the company and its executives.
The first filing came seven days after Crocs' stock plummeted 36 percent to $47.74 from $74.75. At issue were third-quarter sales that fell slightly
under expectations, full-year projections that were under estimates and statements relayed by Crocs executives about an inventory build-up
overseas that contributed to the potentially loss of $30 million in sales.
The lawsuits allege the shareholders who purchased shares during the July 27 to Oct. 31 period were mislead by prior positive statements made by
executives about successful global expansion, and were damaged as a result because the price of the stock was artificially inflated during the quarter.
The allegations go further, claiming that some of Crocs' executives and directors profited off the "artificially inflated" prices, according to the suits.
One suit that names Crocs, Snyder and chief financial officer Peter Case as defendants claims they participated in a "fraudulent scheme."
The "scheme" was to deceive the investing public regarding Crocs' business and its stock value; to enable insiders to sell nearly 1 million shares of
stock to generate proceeds of $58 million; and to cause shareholders to purchase the stock at inflated prices, wrote Denver-based attorney Jeffrey
Allen Berens in a suit filed Nov. 8.
Crocs officials deny the accusations.
"We believe the claims are without merit and we intend to vigorously defend the lawsuits," Snyder says.
The class action suits shouldn't be much more than an annoyance to Crocs, says Elizabeth Montgomery, senior research analyst with N.Y.-based
Cowen and Company LLC.
But Crocs shouldn't expect a resolution in a matter of months, says Christopher Mueller, a University of Colorado law professor. During that time,
a consolidation of the suits should take place, he says. A settlement could be reached before anything goes to trial, he says, noting that would
depend on not only the merits of the accusations, but the company's willingness for an ongoing battle.
"I'm sure a great many companies pay out dollars because they appraise the risks and say, 'Well, we might win this, but if we lose, the liability will
be so much more horrendous than it is to pay out,'" Mueller says.
Full steam ahead
Despite the bumps, Crocs is hardly bruised, says analyst Reed Anderson, of D.A. Davidson & Co.
"I still think this is a very good business. This is a very profitable business," Anderson says. "They're very young. It's gone from nothing to almost
over $800 million in four years."
Anderson's firm initiated coverage on Crocs a month ago. In its disclosure statement, D.A. Davidson says it expects to receive or intends to seek
compensation for investment banking services from Crocs. Its analysts are not directly compensated for involvement in certain banking
transactions.
Robert W. Baird & Co. analyst Mitch Kummetz wrote in a recent research note that he views the Crocs glass as "half-full." Noting Crocs plans to
expand to retailers such as Foot Locker, Kummetz has an "outperform" rating on the stock.
"In a few years, CROX has accomplished what a really successful footwear brand might achieve in 10 or 20 years," he wrote. Robert W. Baird
maintains a trading market in Crocs' stock.
It's yet to be seen whether third-quarter inventory troubles are the effect of seasonality or if the core business is slowing down, says Cowen's
Montgomery, who does not own shares of Crocs.
However, NPD's Cohen says he doesn't think Crocs has broken out of its mold yet. The YOU shoes "didn't even make a ripple in the bucket" in
the rest of the retail world, he says, adding that the brand needs to stand for something on its own — something other than just foam-like shoes
with holes in them.
"The hourglass is starting to run out of some sand here," the analyst says. "The longer you wait, the less opportunistic the timing is going to be in
their favor."
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