A federal judge sentenced former Starkey President Jerry Ruzicka to seven years in prison Wednesday for his role in embezzling more than $18.9 million from the Eden Prairie, Minn.-based Starkey Laboratories, the largest hearing aid manufacturer company in America.
The sentence was considerably less than the 15 to 20 years sought by prosecutors, who said on Wednesday that Ruzicka had not shown remorse for his crimes.
"I think in many respects you are a good person," U.S. District Judge John Tunheim told Ruzicka Wednesday. "You helped a lot of people and in many ways you are responsible for Starkey's success over the years because of your leadership. But obviously things went too far and we have to respect the jury's decision."
Tunheim said the sentence, which also includes a year of probation and fines and restitution, "was sufficient, but not more than what is necessary."
Ruzicka is to report to prison March 11.
Wednesday's sentencing hearing brings to a close a case that has been three years in the making.
Ruzicka was convicted in March by a federal jury in Minneapolis on eight counts of wire, mail and tax fraud.
The charges involved theft of $15.5 million in restricted stock that belonged to Starkey owner Bill Austin; filing a false 2014 tax return, stealing his 2011 company Jaguar; devising hidden bonuses for himself and others and creating sham companies to collect millions of dollars in fake commissions and fees from Starkey and supplier Sonion.
Ruzicka's friend and business associate, former Sonion U.S. president W. Jeff Taylor, was convicted in March on three fraud charges associated with the sham commissions and fees. Taylor's sentencing hearing also is scheduled for Wednesday.
Prosecutors have asked that Taylor be sentenced to seven to nine years of prison.
The sentencing hearings of the two co-defendants who pleaded guilty _ former Starkey CFO Scott A. Nelson and former Northland Hearing subsidiary President Jeff Longtain _ are scheduled for Thursday morning and afternoon. Both Nelson and Longtain cooperated with federal prosecutors during the trial.
Ruzicka's attorneys filed numerous motions asking the court to demand a new trial due to alleged misconduct on the part of the prosecution. Tunheim denied several of those requests in September.
Last month, Ruzicka's attorney, John Conard, filed one more request seeking a new trial based what he described as "new evidence."
Friday, Tunheim denied Ruzicka's request, writing that while the court agreed with Ruzicka that some of Bill Austin's trial testimony "was not credible," the court found that "there was sufficient other evidence to support the [jury's guilty] verdict."
Tunheim added that "Ruzicka has not shown that a new trial is warranted based on his newly discovered evidence."
Conard also requested that his client be assigned to the Federal Prison Camp in Duluth, Minn., so he could be near family. Tunheim said he was agreeable, either with an assignment to Duluth or as close to there as possible.
