In July of 1996, A.T. Cross, a fountain pen manufacturer, established a new division called the Pen Computing Group, or PCG, in an effort to "bridge the worlds of traditional and electronic paper, expand the company's traditional product base and return Cross to acceptable margins." And the only notable result of this forward-thinking effort was the
CrossPad, which came about due to collaboration with IBM based on a new handwriting recognition technology that they had been developing for a few years. However, this thing fizzled out fast on the market resulting in a shareholder securities fraud lawsuit,
Aldridge v. A.T. Cross Corp. Charging that officers of Cross used accounting and sales tricks to mask losses and true sales trends of their PCG products like the CrossPad.
Cross was really confident in this thing publicly and they had stated expectations of at least $25 million in profitable sales in 1998. But to quote the lawsuit, "reality did not keep pace with these projections." By late 1999, the CrossPad development had reportedly ceased and that year the company lost $24.3 million and Aldridge alleged in his suit that statements made by the company management were misleading as well as not following proper revenue recognition practices, specifically claiming that the company employed sales strategies like price protection, take backs, and channels stuffing without properly disclosing any of it to the public or to shareholders.