As the list of options backdating lawsuits has grown ever longer (refer here), one question has been: where will it all lead? Sooner or later, these cases will all have to be resolved, but so far it has remained unclear what the resolution might look like. A recent settlement in the derivative cases filed
Options Backdating: Sue the Gatekeeper?
Way back in 2003, long before any of the rest of us had ever heard of options backdating, Micrel sued its former auditor, Deloitte and Touche, alleging that the accounting firm had given the company faulty advice regarding its options grant practices. In its recently filed 2006 10-K (here), Micrel dislosed that
A New Options Backdating Lawsuit Variation
A shareholder of SafeNet has filed a shareholders derivative lawsuit in Delaware Chancery Court, claiming that the SafeNet directors agreed to sell the company to a private equity firm to avoid potential options backdating related liabilities. On March 5, 2007, SafeNet announced (here) that it had agreed to be acquired by Vector
Another Look at “Lucky” Options Grants
In an earlier post (here), The D & O Diary commented on the research published by Lucian Bebchuk of Harvard Law School and two colleagues, in which they examined over 19,000 options grant awards between 1996 and 2005, finding a disproportionately higher number of grants on the date during the month with the
Backdating Cases Proceed As Deadline Looms
As the Wall Street Journal noted in its February 16, 2007 article entitled “Probes of Backdating Move to Faster Track” (here, subscription required), the various options backdating investigations may be moving more rapidly now. Within the last weeks, there have been guilty pleas entered in connection with the Take-Two (here) and
Dismissal Denied in Delaware Chancery Options Backdating Lawsuits
The options backdating scandal has engendered a flood of shareholders’ derivative lawsuits (146 as of the last count, here). The D & O Diary has previously questioned (here) plaintiffs’ lawyers’ apparent enthusiasm for these suits given the numerous potential defenses these cases present, including, among others, statute of limitations, demand failure, and
Options Backdating News and Notes
While 144 different companies have been named as nominal defendants in options backdating related derivative lawsuits (see The D & O Diary’s running tally of options backdating related lawsuits here), a new lawsuit filed in federal court in Houston on Thursday will be of particular interest to The D & O Diary’s readers, both
Revised Options Backdating Litigation Count
Regular D & O Diary readers know that I have been maintaining a running tally of options backdating related litigation (here). According to the most recent count, so far there have been 23 securities class action lawsuits raising allegations of options grant manipulations. (The Stanford Law School Securities Class Action Clearinghouse maintains its
Cash Bonuses for Backdated Options
According to a January 20, 2007 Wall Street Journal article entitled “Executives Get Bonuses As Firms Reprice Options” (here, subscription required), some of the companies ensnared in the options backdating scandal are paying cash bonuses to executives whose options are being repriced, as the option exercise price is shifted to the actual grant
Options Backdating Litigation Update
On January 16, 2007, the Lerach Coughlin firm filed a purported securities class action lawsuit in federal court in the District of Columbia against Sunrise Senior Living and several of its directors and officers. A copy of the law firm’s press release can be found here and a copy of the complaint can be found