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U.S. Securities and Exchange Commission


Litigation Release No. 18571 / February 6, 2004

Accounting and Auditing Enforcement
Release No. 1955 / February 6, 2004

Securities and Exchange Commission v. Jonathan G. Epstein, Civil Action No. 2:04-CV-0218 (NDAL February 4, 2004)

The Securities and Exchange Commission filed a Complaint on February 4, 2004, in the United States District Court for the Northern District of Alabama against Jonathan G. Epstein (Epstein), former President and Chief Executive Officer of Fila U.S.A. (Fila), an outside vendor of Just for Feet, Inc. (JFFI) in Birmingham, Alabama.

The Complaint alleges that Epstein assisted in perpetrating a financial reporting fraud involving the financial statements of JFFI, a former national retailer of athletic and outdoor footwear. Epstein signed an audit confirmation letter stating falsely that Fila owed JFFI $1.38 million in advertising "co-op receivables" which JFFI had improperly recorded. This overstatement of income was reflected on JFFI's financial statements included in its Form 10-K filed for fiscal year 1998, Forms 10-Q filed for the first and second quarters of fiscal year 1999, and in its registration statements on Forms S-8 and S-4 filed in May and June of 1999, respectively.

The Complaint seeks a permanent injunction enjoining Epstein from further violations or aiding and abetting violations of Section 17(a) of the Securities Act of 1933, Sections 10(b) and 13(a) of the Securities Exchange Act of 1934 and Rules 10b-5, 12b-20, 13a-1 and 13a-13 thereunder. The Complaint further seeks the imposition of civil monetary penalties against Epstein.

SEC Complaint in this matter


Modified: 02/09/2004