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CEO leads stun gun challenge from Tampa

By ROBERT TRIGAUX
Published August 5, 2005

A small company with visions of competing in the high-profile stun gun market controlled by Taser International quietly moved its headquarters this summer to Tampa from Charlotte, N.C.

Stinger Systems Inc., now ensconced in a suite on Rocky Point Drive, says it will start pitching the "Stinger" - a $600, four-dart stun gun - to law enforcement agencies this year.

Stinger Systems is run by chief executive Robert Gruder, who made a small fortune running a Y2K-fix-it tech company.

He boasts a colorful history with businesses that tend to soar to great heights but soon fall to earth.

Why move Stinger Systems' headquarters to Tampa? The company says Gruder was traveling and not available Thursday. But he relayed his responses through a company spokesman.

"He feels Tampa is more suited to his business model, that Tampa embraces entrepreneurial companies and growth and has a labor pool accustomed to fast-paced companies," spokesman Paul Tarr said.

Okay. But what about Charlotte?

"By comparison, Charlotte is more of a banking town," related Tarr. By that, I'm guessing Charlotte was a bit too stuffy for Gruder and his plans to start promoting the Stinger.

A closer look at Stinger Systems makes one wonder if they tested their product on themselves.

The stun gun maker was a hot stock with shares topping $40 in January when stun guns were all the rage as "less-than-lethal" alternatives to firearms used by police departments. Investors saw Stinger as a new Taser International.

Now Stinger's stock, which thinly trades on the pink sheets over-the-counter market, hovers near $5 a share.

Stun gun giant Taser saw its stock quadruple in price last year as more than 6,000 police departments and prisons bought its product.

Taser shares hit a 52-week high in January, but have dropped from negative news.

The company has been confronted with numerous stories of people who died after being hit by Taser's stun guns. Among the latest: A man in San Jose, Calif., died after he was hit Monday.

Stinger Systems plans to start pitching its stun gun to law enforcement agencies while fighting a lawsuit by Taser alleging false advertising.

Taser's suit claims Stinger Systems has no viable product and that video testimonials depicting superior performance of the Stinger stun gun were staged.

Stinger denies the allegations and says it countersued for libel and slander.

Stinger last month also acknowledged that the Securities and Exchange Commission is investigating the company and expects to recommend taking action against Stinger for violating securities laws.

In January, Stinger hired the former president of weapons maker Smith & Wesson to run the company. He left less than three months later, leaving Gruder to take back the job of CEO.

Adding to Stinger Systems' difficulties is this year's insightful but biting criticism of the company and Gruder by online commentator Seth Jayson on the Motley Fool investment Web site.

Of course, Stinger Systems could dismiss much of these aggravations if it really does unveil a stun gun that works well and can compete with Taser.

Gruder is scheduled to unveil the Stinger next month at a New York investment conference.

A former banker, Gruder began his entrepreneurial days by starting software firm GEM Technologies in Connecticut. It filed for bankruptcy in 1992.

A second software business, Alydaar, did better in the latter 1990s as a fix-it service for corporations worried their computer systems would not survive the so-called Y2K bug when 1999 rolled into the year 2000.

That Charlotte company was succeeded by Information Architects Corp., whose stock briefly hit $160 a share. The remnant of that company now trades at 6 cents a share.

Freshly arrived in Tampa, Gruder's company aims to make a mark with stun guns.

But Stinger Systems can also pitch some other intriguing products designed to subdue people with electric shock. Band It controls unruly prisoners in the courtroom or during transportation. Ultron II is a hand-held shocking device.

Here's my favorite: Ice Shield, an electrified riot shield for "hazardous crowd control, civil disturbances, prison uprisings and forced prison cell entries."

Robert Trigaux can be reached at trigaux@sptimes.com or 727 893-8405.

[Last modified August 5, 2005, 01:07:16]