Inside Track
See more of the story

It's been a busy month for the Starkey Labs crew as its convicted former president recently filed his long threatened court appeal, received a new date to report to federal prison and learned that he's being sued for ESOP fraud by former co-workers.

Jerry Ruzicka, who was sentenced in December to seven years in prison, appealed his fraud and embezzlement convictions last month in federal district court in Minneapolis.

Ruzicka and his co-defendant W. Jeffrey Taylor also recently learned that they must now report to federal prison on July 8, instead of this month. Their jail reporting dates have both been postponed several times.

U.S. District Court Judge John Tunheim submitted paper to the Federal Bureau of Prisons last month saying he saw no problem if the men were assigned to serve their time at the Federal Prison Camp in Duluth or nearby. While Ruzicka faces a 7-year sentence, Taylor received an 18-month prison sentence.

Last week, several former co-workers sued Starkey, Starkey's majority-owner Bill Austin, Ruzicka, Taylor and others for embezzlement schemes or mismanagement that led to the company ESOP plan losing millions in value.

Ruzicka was convicted last year on eight counts of mail, wire and tax fraud relating to various schemes that embezzled more than $20 million from the Eden Prairie-based hearing aid manufacturer. He received a seven year prison term. Now he faces additional court woes in the form of the ESOP civil lawsuit.

Taylor, Ruzicka's friend and the former president of supplier Sonion USA, was convicted last year on three counts of fraud for his role in working with Ruzicka to create sham companies and siphon money from Starkey and Sonion. The fake companies allowed Taylor and Ruzicka to received hundreds of thousands of dollars in bogus fees and commissions, the jury found.