U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 18508 / December 17, 2003
Securities and Exchange Commission v. Dorothy L. Mahler, John W. Bracewell, III, and Patricia L. Jones, Civil Action No. 3:03-CV-1202 (MDTN December 16, 2003)
The Securities and Exchange Commission announced today that it has filed a complaint in the United States District Court for the Middle District of Tennessee against Dorothy L. Mahler ("Mahler"), John W. Bracewell, III ("Bracewell") and Patricia L. Jones ("Jones"), all residing in Tennessee.
The complaint alleges that the defendants perpetrated a financial reporting fraud involving the financial statements of Genesco, Inc. ("Genesco"), a footwear and accessories company headquartered in Nashville, Tennessee. Mahler, President of Genesco's Johnston & Murphy division, Bracewell, a division vice president, and Jones, the division's Director of Customer Care, caused Genesco to improperly recognize $2.8 million of sales revenue prior to the end of a quarter and in advance of a customer's requested shipping date. The defendants improperly recorded revenue in the quarter to meet sales targets for the quarter. This overstatement of sales and earnings was reflected on Genesco's financial statements included in its Form 10-K for fiscal year 2001.
The complaint seeks permanent injunctions enjoining defendants Mahler, Bracewell, and Jones from further violations or aiding and abetting violations of Sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(5) of the Securities Exchange Act of 1934 and Rules 10b-5, 12b-20, 13a-1 and 13b2-1 thereunder. The complaint further seeks disgorgement of all ill-gotten gains with prejudgment interest against Mahler and Bracewell, the imposition of civil penalties against Mahler and Bracewell, and an officer or director bar against Mahler.