February 15, 2001, 3:27 PM — INSTANT MESSAGING INFRASTRUCTURE company Critical Path announced the resignation of its chief executive officer Friday, a week after accounting irregularities sent the company's stock into a tailspin, drawing shareholder lawsuits and a halt to the company's stock trading in the financial markets.
Doug Hickey stepped down as CEO, to be replaced in function if not in title by David Hayden, Critical Path's chairman and founder, as executive chairman, while the company looks for a new chief executive. Two other Critical Path executives were suspended in the wake of concerns over alleged accounting irregularities -- David Thatcher, its president, and William Rinehart, vice president of worldwide sales. Both have now left the company, Critical Path also announced in a release.
Critical Path, which is majority owned by Internet company incubator CMGI, announced in January a net fourth-quarter loss of $11.3 million. Shareholder suits filed against the company allege that the loss was directly contrary to what Hickey had told shareholders and analysts just weeks before. Days later in February, the company announced that the January results "may be materially misstated."
Critical Path's stock plunged 67 percent, to $3.86 per share, immediately following the first February announcement, before the Nasdaq exchange halted trading.