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Harold Ruttenberg Died; Founded Scandal Scarred Chain
DECEMBER 28, 2005 --
Harold Ruttenberg, founder of Just For Feet, died at age 63. Ruttenberg was diagnosed with brain cancer in January 2004.
He created the huge Just For Feet chain. It was a highly imaginative approach to the sale of athletic footwear and licensed apparel. The JFF stores were huge, with vendors making individual presentations on the floor, creating boutiques on the sales floor. The stores, which included franchises, were unique.The shoe wall highlighted the hundreds of SKUs JFF offered. Unfortunately, investors found the spectacular results were based on the fraud.
The company cooked the books, assisted by some industry executives who signed off on bogus audit certifications. The company started unraveling earlier after it acquired some footwear stores that were more traditional in size, including Athletic Attic and Imperial Sports. JFF was the second largest athletic footwear retailers in the US. Internal mistakes resulted in the inventory for the latter stores being ordered twice. JFF went bankrupt and was acquired by Footstar, which also went under due to errors at its shared financial services operation.
JFF investors lost all their money following the bankruptcy. After that, federal investigators discovered the fraud. Son Don-Allen Ruttenberg was sent to jail. The elder Ruttenberg was never charged. Several industry executives were forced to pay fines and were subject to house arrest following the probe. There are still shareholder lawsuits being pressed.
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Categories
Executives
Sporting goods industry
Licensed apparel
Arrests
Apparel manufacturing
Companies
JFF
Footstar Inc.
Concepts
athletic footwear
industry executives
shared financial services operation
athletic footwear retailers
footwear stores
People
Don-Allen
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