The first sentence in the Just for Feet fraud case was handed down on Thursday, with adidas America’s Timothy R. McCool receiving an eight-month sentence and a $10,000 fine. He pled guilty in October to conspiracy to submit false statements to the auditors of Just For Feet, Inc. and to falsify the books and records of JFF.

The sentence was considered to be more lenient due to McCool’s cooperation in the case against Just for Feet and its former management. McCool is expected to serve four months of the sentence in prison and four months in a non-custody manner, which could include home detention, depending on circumstances.

U.S. District Judge C. Lynwood Smith Jr. handed down the sentence Thursday afternoon in Birmingham.

McCool faced a sentence in the range of 24 to 30 months, but prosecutors asked for a lower guideline level due to his cooperation. The new guidelines put him in a new range of eight to 14 months, with the prosecutors urging the minimum. McCool’s attorney asked the judge to reduce the sentencing another level, but Smith said he was bound by guidelines.

As of Friday, McCool was still in the employ of adidas America and the company appears to be standing by their guy. He reportedly has until early May to get his affairs in order before reporting for incarceration.

The case has so far snared four industry vendor executives and three former JFF employees, including Don Ruttenberg the son of the failed retailer’s founder. Ruttenberg entered a not guilty plea on March 16, after reaching an earlier plea deal. Adam Gilburne, the former president of Just for Feet, received a continuance in his sentencing that was originally scheduled for early January. Steven Davis, the former VP of Marketing for JFF, has an arraignment and Change of Plea hearing scheduled for March 31. He originally pled guilty.

On the vendor side, Tom Shine, the former Logo Athletic president who has most recently been Reebok’s SVP for Sports & Entertainment Marketing, is scheduled for sentencing on June 26. Jon Epstein, the former Fila CEO, will face sentencing on May 21, and Steve Dodge, the former VP of Sales for the pre-bankruptcy Converse, is scheduled to be sentenced on May 18, 2004.

No doubt, the events of last week will get the attention of those that entered guilty pleas and those that are still being “interviewed” by the FBI and U.S. Attorney’s office. Perhaps we were all a bit naïve to think that this would be treated as an honest mistake and the Feds were only looking for people to help go after the insiders on this deal. It’s a very unfortunate wake-up call.


>>> It’s ironic that last week also saw the final Going Out of Business signs hoisted above the remaining 88 Just for Feet stores now owned by bankrupt Footstar, Inc. Good riddance to the whole lot…