Semiconductor Laser gets more subpoenas

CNY Business Journal (1996+), Dec 22, 2000 by Dickinson, Casey J

BINGHAMTON - Semiconductor Laser International Corp. (SLIC) has received more subpoenas from the U.S. Securities and Exchange Commission in connection with an ongoing investigation, according to documents the company filed with the SEC earlier this month.

The commission documents state that SLIC and its CEO Geoffrey Burnham had received further subpoenas in connection with an SEC investigation of possible security-law violations dating to 1998. In the SEC Form 8-K, filed on Dec. 6, SLIC says "the company is not able to speculate as to the specific subject matter of the investigation."

SLIC and its corporate officers provided documents to the SEC two years ago under subpoena. The latest filing says Burnham and SLIC have retained separate counsel in connection with the investigation.

An SEC spokesperson said the agency does not discuss open investigations and Burnham says he can't comment on the filing.

SLIC's annual report for 1998 discloses that the company had responded to informal requests for information from the SEC since April of that year. The SEC issued a formal order of investigation in connection with SLIC in June 1998, according to the same report.

The company's 1998 report also states that it responded to a grandjury subpoena from the U.S Attorney's office for the Southern District of New York issued in connection with a securities law investigation concerning SLIC's public disclosures. SLIC is cooperating with both investigations, the filing said. A later filing said the company had been informed by the U.S. Attorney's office that it was not a target of the investigation.

A development agreement between Semiconductor Laser International Corp. and Florida-based gun-lock maker Saf-T-Lok, Inc. was the subject of three class-action lawsuits filed in Florida against Saf-T-Lok during 1998. The Florida company's shareholders charged that Saf-T-Lok officials had violated federal securities laws by making misrepresentations and failing to disclose material information about a development agreement with SLIC, according to Saf-T-Lok's SEC filings.

The product-development agreement, announced on May 26, 1998, covered the production of a fingerprint recognition system used to secure firearms against unauthorized use. The complaint in the case alleged that Saf-T-Lok officials knew that SLIC had no experience with fingerprinting technology and could not fulfill the agreement, according to the plaintiffs' law firm, Wolf, Haldenstein, Adler, Freeman Herz.

Saf-T-Lok canceled the deal and fired the CEO who entered into the agreement with SLIC less than three weeks after it was announced. The gun-lock company's stock price promptly fell, triggering the shareholder suits.

Saf-T-Lok settled the cases for $850,000 earlier this year, according to the company's SEC reports.

Founded in 1993, SLIC produces lasers used by manufacturers in a broad range of products, including telecommunications equipment and medical devices.

The company employs 33, and has yet to produce a profit. Accumulated losses since 1993 have totaled more than $23 million, according to a November SEC filing.

SLIC stock hit a new low on Nov. 27, trading at 9 cents per share on the OTC board. The company was: delisted from the NASDAQ in May 1999.