Rudy! Rudy! Rudy!

//Rudy! Rudy! Rudy!

Rudy! Rudy! Rudy!

I refuse to believe that there is a male out there who is in between the age of 22 and 48 who hasn’t seen the movie Rudy.  A feel good story about Daniel Ruettiger, a scrappy little guy who works his tail off to make the Notre Dame football team despite lacking the physical ability.  The movie is amazing and elicits tears from the toughest of men (not this guy but The Wife calls me an emotional wasteland so I am not a good barometer).  So at this point you probably think I am going to make some connection between working hard and making money, nope not this time.  Instead lets get an update on Daniel Ruettiger.

Where is Daniel Ruettiger Today?

I was reading the January Issue of Registered Rep Magazine when I came across the blotter titled, “Notre Lame

According to the SEC, Ruettiger deceived investors into buying stock in Rudy Nutrition, his sports drink company meant to compete with Gatorade. Instead, Ruettiger used the company as a vehicle for a pump-and-dump scheme that occurred in 2008 and generated more than $11 million in profits.

The SEC claims the company gave investors false and misleading information about its activities in press releases, SEC filings and promotional materials. This included materials that claimed the company’s sports drink “Rudy” outperformed Gatorade and Powerade in taste tests, and outsold Gatorade. The participants also manipulated trading to artificially inflate the price of the company’s stock while selling unregistered shares to investors.

Ruettiger has agreed to settle with the SEC for $382,866, and other participants have agreed to final judgments also ordering disgorgement, prejudgment interest, and financial penalties.

OH NO RUDY SAY IT AIN’T SO!  It was hard for me to believe Rudy would be involved but it wasn’t too hard to find the official SEC Press Release,

The SEC alleges that investors were provided false and misleading statements about the company in press releases, SEC filings, and promotional materials. For example, a promotional mailer to potential investors falsely claimed that in “a major southwest test, Rudy outsold Gatorade 2 to 1!” A promotional e-mail falsely boasted that in “several blind taste tests, Rudy outperformed Gatorade and Powerade by 2:1.” Meanwhile, the scheme’s promoters engaged in manipulative trading to artificially inflate the price of Rudy Nutrition stock while selling unregistered shares to investors. The SEC suspended trading and later revoked registration of the stock in late 2008. Rudy Nutrition is no longer in business.

“Investors were lured into the scheme by Mr. Ruettiger’s well-known, feel-good story but found themselves in a situation that did not have a happy ending,” said Scott W. Friestad, Associate Director of the SEC’s Division of Enforcement. “The tall tales in this elaborate scheme included phony taste tests and other false information that was used to convince investors they were investing in something special.”

According to the SEC’s complaint, Ruettiger was the principal founder and namesake of a company called Rudy Beverage Inc. that he and a college friend ran out of South Bend, Ind. until October 2007, when Rocky Brandonisio became the company’s president and day-to-day business manager. He moved the company’s operations to Las Vegas, where he and Ruettiger live. Ruettiger remained CEO. During this time, the company struggled financially with few customers, few assets, and no profits.

The SEC alleges that Ruettiger and Brandonisio brought in an experienced penny stock promoter named Stephen DeCesare to orchestrate a public distribution of company stock in late 2007. Ruettiger knew DeCesare from previous business dealings, and they were neighbors in Las Vegas. Ruettiger and Brandonisio gave DeCesare sufficient control to turn Rudy Beverage into a publicly traded company. DeCesare became the primary organizer of the resulting pump-and-dump scheme

It sounds from the press release that Rudy had an alright company that was just hemorrhaging when someone said, “hey I know a away to raise money, lets go public.  Don’t worry a friend of mine knows a guy.”  ORRRR I am just trying to make 13 year old Evan feel a bit better.

By | 2013-09-26T14:56:42+00:00 January 26th, 2012|Investments|20 Comments

About the Author:

Evan is the owner of My Journey to Millions which was started to track his journey from a broke debt ridden law school graduate to building a positive balance. Need more Evan? Follow him on Twitter, Contact him or get new posts directly to your email

20 Comments

  1. PK January 26, 2012 at 11:19 am - Reply

    Thanks for passing this along. I went to USC and my parents went to BC… and my brother decided to attend ND, a rival for both schools. He’ll love this…

    • Evan February 3, 2012 at 12:51 am - Reply

      I hope you forwarded him the post lol

  2. Simon January 26, 2012 at 12:58 pm - Reply

    Bah! This just sucks.
    Rudy is one of my fav movies and for the 99% of us who were too small, short or fat to play organized sports in university Rudy was a hero to me.

    Not so much anymore.

    • Evan February 3, 2012 at 12:54 am - Reply

      I am in the 99% lol

  3. krantcents January 26, 2012 at 3:26 pm - Reply

    Whatever happened to our values? Doesn’t integrity matter anymore? The easy way out of a problem usually leads to something like this.

    • Evan February 3, 2012 at 12:54 am - Reply

      I am curious for more facts but I don’t think we’ll get any

  4. Jeff January 26, 2012 at 3:59 pm - Reply

    I think the 14 year old in you could be clouding your judgement – I was as shocked as anyone to read the story though. On the other hand if he made 11m and only had to pay ~400k in fines, then he should still have 10.6m in the bank

    • Evan February 3, 2012 at 12:54 am - Reply

      hahahaha not sure it works that way

  5. retirebyforty January 26, 2012 at 4:43 pm - Reply

    Heh heh, maybe I have to catch Rudy one of these days. I know Sean Astin is in it right?

    • Evan February 3, 2012 at 12:55 am - Reply

      Seriously? You have never seen it?! DO YOURSELF A FAVOR RENT IT

  6. Jenna January 26, 2012 at 5:13 pm - Reply

    How do people fall for these scams? Has anyone ever heard of the Rudy brand before? I’m sure people would be interested to try it.

    • Evan February 3, 2012 at 12:56 am - Reply

      I don’t think it is too hard to fall for the scheme if you really believe in the product

  7. Hunter January 26, 2012 at 7:51 pm - Reply

    If it’s on Netflix, I’ll watch it tonight…no shame, I’m a new American : ) Happy Australia Day by the way.

    • Evan February 3, 2012 at 12:57 am - Reply

      Did you get to see it?

  8. Don January 26, 2012 at 9:15 pm - Reply

    Sad turn of events. The issue is we’ll never know what really happened and his true involvement…

    Even if he comes out with a book, whatever he writes has been tarnished by the lawsuit…

    • Evan February 3, 2012 at 12:58 am - Reply

      ooooo I’d love to see the story, but I think you are right we are never learning what went down. Maybe on American Greed lol

  9. JP January 26, 2012 at 10:46 pm - Reply

    Not a Rudy fan, of the man not the movie. Like most, the movie is much better than the real story. I’m sure he got what he deserved.

    • Evan February 3, 2012 at 1:00 am - Reply

      Phew I had to read that a couple times to make sure you liked the movie lol

  10. IIW January 28, 2012 at 6:22 pm - Reply

    I do remember that movie. That is not too cool… 🙁

    • Evan February 3, 2012 at 1:00 am - Reply

      You probably would have liked it more if it was hockey, eh? LOL JK

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