A former iVillage bigwig is trying to delay the company's stock launch with a lawsuit that claims iVillage cheated him out of more than US$1 million worth of stock options.
The executive, Todd Kenner, says iVillage lured him last year with promises of bonuses and stock options to take a job as the company's president of business development. But six months after he quit his old job and moved from Nashville, Tennessee, to New York, iVillage fired him.
Kenner blames the company and its chief executive, Candice Carpenter, for leading him to expect a highly paid executive position, then changing its tune.
"Ms. Carpenter specifically represented that, at iVillage, an employee's status and seniority is evidenced entirely by the number of one's stock options," the lawsuit asserted. Since Kenner was promised 100,000 shares -- expected to pay out between $1 million and $2 million in an initial public offering sometime in the next few weeks -- he expected to be ranked as a top executive.
Instead, when the company reorganized last fall, he was out of a job and "other male executives were demoted in standing within the company," which runs a collection of sites targeted to women. He stopped short of including a discrimination claim in the lawsuit.
In the suit, Kenner says iVillage should be forced to give him back the options he says he was promised. Unless the company agrees, he wants the court to stop iVillage from proceeding with the IPO.
A spokesman for iVillage called the suit "frivolous and absurd." The company also said the suit has "nothing to do with gender discrimination." The company has already filed a motion to dismiss the lawsuit and hasn't said anything about delaying its stock offering.
Lawyers for iVillage wouldn't comment on the lawsuit, claiming that doing so would violate Securities and Exchange Commission restrictions on companies about to go public.
David Berger, a securities-law partner with Wilson Sonsini Goodrich & Rosati, says lawsuits brought by former employees over stock options are quite common. Seeking to delay an IPO, however, is unusual. And getting a court injunction for such a delay seems unlikely, he says.
"In order to get that type of an injunction he would have to show that he'd be irreparably harmed if the company went public," Berger says. "It's hard to see, off the top of my head, why you'd see an irreparable injury."
