In recent days, there has been extensive media attention (here and here) focused on the fact that plaintiffs’ lawyers seeking to exploit the options backdating scandal are filing shareholders’ derivative suits in preference to securities fraud class action lawsuits. Indeed, The D & O Diary’s running tally of options backdating lawsuits (here
Options Backdating
Capitol Hill Looks at Options Backdating
By Kevin LaCroix on
Posted in Options Backdating
The unfolding options backdating story may have hit its high water mark (or its low point, depending on your perspective) on September 6, 2006, when the Senate Committee on Banking, Housing and Urban Affairs and the Senate Finance Committee both held hearings concerning options backdating. The hearings involved the testimony of numerous regulators, academics and…
Options Backdating Notes from Around the Web
By Kevin LaCroix on
Posted in Options Backdating
SEC Options Backdating Investigations List: Directorship.com has posted on its website a hotlinked list of companies (here) that have been contacted by the SEC, revealed a probe by the SEC, or have been subpoenaed by a U.S. attorney, in connection with the options timing investigations. The Wall Street Journal’s Options Scorecard list of…
Proxies, Shareholder Consent, and Options Backdating Litigation
By Kevin LaCroix on
Posted in Options Backdating, Proxy Statements
The D & O Diary’s list of options backdating litigation (here) has been updated to include the action (here) filed on August 23, 2006 against Zoran Corporation and ten of its past or present directors and officers. The Zoran complaint presents an interesting variation in the options backdating litigation, because it…
Companies Sound “All Clear” on Options Backdating
By Kevin LaCroix on
Posted in ERISA, Options Backdating
Earlier in the summer, it was a seemingly daily occurrence for one or more public companies to announce that they were launching internal probes of their options practices. (These announcements were accompanied, and no doubt encouraged, by numerous simultaneous announcements of SEC probes, U.S. Attorney’s subpoenas, and the like.) Now as the summer has, alas,…
SEC Commissioner: Potential Outside Director Liability for Options Backdating?
By Kevin LaCroix on
Posted in Options Backdating
In an August 15, 2006 speech entitled “How to be an Effective Board Member” (here), SEC Commissioner Roel Campos made a number of interesting comments about the potential liability of corporate board members, and for that reason the entire speech merits reading. Of particular interest to The D & O Diary are Commissioner…
Brocade Communications Settles Shareholders’ Derivative Lawsuit Concerning Options Backdating
By Kevin LaCroix on
Posted in Options Backdating
According to August 10, 2006 press reports, Brocade Communications settled the derivative lawsuit that shareholders had filed in federal court in San Francisco in connection with Brocade’s options-award timing miscues, in exchange for an agreement to adopt certain therapeutic governance measures and the payment of $525,000 in legal fees. The settlement also involves contributions…
FCPA, Options Backdating, and D & O Exposure
By Kevin LaCroix on
In this prior post, the D & O Diary noted the recent resurgence of the 70’s vintage statute, the Foreign Corrupt Practices Act. Recent developments in the Comverse Technology options timing investigation underscore the increasing importance of the FCPA, particularly as the options backdating scandal continues to unfold.
On August 9, 2006, the…
Catching Up on Options Backdating
By Kevin LaCroix on
Posted in Options Backdating
Molex Execs Repay Pay: In one of the more interesting (and speediest) resolutions by a company of options timing concerns, 12 executives of Molex, Inc. agreed to repay the company a total of $685,000 to cover gains they realized on misdated options. The executives also agreed to have the prices raised on their unexercised…
White Collar Crime Trends and the Options Backdating Investigations
By Kevin LaCroix on
Posted in Options Backdating
With all of the media attention focused on the first options backdating criminal complaint, filed July 20, 2006 against two former officials of Brocade Communications Systems, and with published reports suggesting (for example in the July 21, 2006 front page article of the Wall Street Journal , subscription required) that prosecutors are investigating “over…