The insurer responsible for covering Cutter & Buck Inc's primary directors' and officers' liability insurance is attempting to annul the policy following an earnings restatement earlier this year.

In a press release Monday, Cutter & Buck said it disagrees with Genesis Insurance Co's rationale and doesn't believe it is entitled to rescind the policies.

The sportswear company in August said it would restate fiscal 2000 and 2001 results after discovering that $5.8 million of merchandise shipped in fiscal 2000 was recorded as sales of inventory but was in fact made on a consignment basis.

Although Cutter & Buck said the managers responsible for the accounting irregularities no longer had any role with the company, it was still hit with three class action securities lawsuits and one shareholder derivative suit.

If discussions with Genesis Insurance fail then Cutter & Buck will consider formally disputing the decision to rescind coverage. If that fails, Cutter & Buck would have to carry the full consequences of pending litigation.