Earlier quoted context omitted.
You don't see anything sleezy about an employee who put in both sweat equity and money getting nothing for his stock, while other shareholders are reimbursed for theirs? Seems both sleezy and a cautionary tale for those thinking of working at a startup from where I'm sitting...
The general definition of preferred shares is that they are treated preferentially to common shares. In the most typical case, they get their money back before the remaining funds, if any, are disbursed. So no. There's nothing sleazy about a preferred shareholder being treated preferentially, necessarily.
When you issue stock to someone, you accept a fiduciary responsibility for increasing the value of those shares to the best of your ability. That fiduciary responsibility includes siding with their interests if and when a conflict of interest arises.
If the founders really did receive a large pay day while taking the value of their non-preferred stock to zero, then it sounds like that fiduciary responsibility was ignored.
So yes. Sleazy is an appropriate word.