“Don’t tase me, bro!” immediately entered the national lexicon when university police in Florida zapped a student at a John Kerry speech last month. The phrase already has its own entry in Wikipedia and is well on its way to becoming part of the “permanent cultural lexicon,” Wired says.
But the incident also substantially raised the profile of Taser International, makers of the police zappers. Company stock is skyrocketing on new orders and it has fended off dozens of lawsuits. On Monday, Taser reported a doubling of its third-quarter sales. Its shares surged nearly 11 percent Tuesday. The stock is trading at its highest level in two years.
In 2006, only 20% of U.S. domestic law enforcement agents carried Taser stun guns; in 2007, that figure is expected to hit 30%, according to an analyst at Craig-Hallum Capital.
This is a far better picture for Taser International than two years ago, when it was hit with embarrassing revelations about insider stock sales and investigations by the SEC and the Arizona attorney general. (The investigations ultimately resulted in no charges against the company.)
Forbes reported that several members of the founding Smith family and board members of Taser sold large amounts of stock just before the price collapsed in early 2005. Phillips W. Smith retired as chairman and sold $40.8 million worth of holdings. His sons Patrick and Thomas Smith sold $23 million and $17.7 million of Taser stock respectively, totaling 22% of their combined common stock holdings.
The company also was stung in 2004 after President Bush appointed Bernard Kerik, a company director, to run the Homeland Security Department. Kerik made $6.2 million exercising stock options from Taser, which had contracts with Homeland Security and New York City. Taser was one of many companies that received contracts through Kerik’s relationship with former New York Mayor Rudy Giuliani, after he left his job as New York City police commissioner in 2001. Kerik subsequently withdrew his name from consideration as Homeland Security secretary.
There have been an estimated 84 deaths associated with Tasers but the Scottsdale, Ariz., company has been aggressive in defending itself in court. Taser announced on its web site this month the 59th time a wrongful death or injury lawsuit had been dismissed or judged in favor of Taser.
On Tuesday, the U.S. District Court for the Eastern District of Louisiana dismissed a lawsuit against Taser. In that case, the family of a 55-year-old man, who was intoxicated, didn’t show why he went into cardiac arrest when he was shocked by a Taser.
On the web
Taser’s Stunning Comeback – Forbes