11, 20 · e backdating scandal was set off in 2005 after Erik Lie, a finance professor at e University of Iowa, published a study at showed an uncanny number of cases where companies granted stock. E EMERGING STOCK OPTIONS BACKDATING SCANDAL AND STRATEGIC APPROACHES TO CLAIMS FOR COVERAGE Kevin T. Coughlin, Esq. Suzanne C. Midlige, Esq. Robert J. Re, Esq. William J. Hoffman, Esq. 350 MOUNT KEMBLE AVENUE WALL STREET PLAZA P.O. BOX 1917 88 PINE STREET, 5 FLOOR MORRISTOWN, NEW JERSEY 07962-1917 NEW YORK, NEW YORK 005. 15, · Options have value only when e underlying stock’s price is higher an e exercise price, allowing executives to purchase e stock at a discount. Companies engaged in backdating wait for stock prices to rise and en grant executives at- e-money options at are dated earlier, when prices were lower. Apple and e Options Backdating Scandal of e Past ade. In 2001, Apple’s board of directors and some of its executives backdated options wi out properly reporting to e SEC. is was one of many options backdating scandals to occur wi in e last ade. 12, 2007 · e crux of e scandal is e timing of stock options. But calling it backdating makes e problem sound far more innocuous an it really. As we know, stock options are a popular corporate incentive, generally meant to give executives a vested interest in e company’s stock . More an one hundred companies have been implicated in e recent federal inquiry into stock options backdating. 1 In y and ust 2006, criminal charges were filed against executives from Comverse Technology, Inc. and Brocade Communications Systems, Inc. 2 Wi more criminal charges in e pipeline, companies and executives need to understand e potential scope of criminal liability. e Stock Option Backdating Scandal: Lessons For Privately Held Companies Law360 (ober 20, 2006, 12:00 AM EDT) e publicity surrounding backdating of stock option grants has focused on. e D & O Diary’s list of options backdating litigation has been updated to include e action filed on ust 23, 2006 against Zoran Corporation and ten of its past or present directors and officers. e Zoran complaint presents an interesting variation in e options backdating litigation, because it focuses on allegedly improper or misleading solicitation of shareholder proxies and consent. e SEC's complaintfocuses on e backdating of two large option grants, one o.8 million shares for Apple's executive team and e o er of 7.5 million shares for Steve Jobs. 11, · Options backdating was a common way for corporate boards to pass more compensation onto managers and directors. Stock options allow people to buy corporate shares at a pre-arranged price. 01, 2006 · e U.S. stock options scandal More an 130 American companies are under investigation on suspicion of having backdated stock options. At least two dozen executives or directors have been fired. Apr 27, 2009 · Ron Haruni Forbes has been able to obtain e full text of Steve Jobs’ sworn deposition given on ch 18, 2008, to e Securities and Exchange Commission (119-pages) over Apple’s (AAPL) options. 01, 2009 · e figure presents buy-and-hold abnormal stock returns around e date of e first firm-specific backdating (i.e. t=0) for ree arate groups of companies listed on e Wall Street Journal (2006) website on ember 31, 2006 as being implicated in e stock options backdating scandal. Criminal charges filed against former executives of Brocade Communications Systems could be a sign of more indictments to come in an options backdating scandal at has cast a shadow over many. 06, 2006 · e genesis of e scandal stems from e ad of executive stock options. A stock option is a right to purchase stock at a fixed price, or exercise price, which is typically determined by e stock’s price at 4 p.m. on e date of e stock option grant. An options holder usually has to wait at least one year before exercising his. 29, · Under Dating Game 1.0, a company would surreptitiously backdate its grants of stock options to coincide wi recent dips in its share price. If e stock had recently climbed from $ to $12, e company would backdate e stock options so at executives could still get e shares at $. Options backdating is e practice of altering e date a stock option was granted, to a usually earlier (but sometimes later) date at which e underlying stock price was lower. is is a way of repricing options to make em valuable or more valuable when e option strike price (e fixed price at which e owner of e option can purchase stock) is fixed to e stock price at e date. 17, · CEO Frank C. Lin was accused of backdating stock option documents to give e appearance at options were granted on earlier dates an issued. is scheme was allegedly used to . Fifty-two companies currently under criminal investigation. Two indictments. Multiple guilty pleas. All stemming from e practice known as options backdating. Options backdating occurs when a company issues stock options on one date, but reports in its financials an earlier issue date to create a strike or exercise price equal to e earlier date’s lower price. 06, · Lastly, Stet went way back to e stock option backdating scandal at claimed e jobs of dozens of top executives at Apple, Altera, Broadcom, . 09, · But backdating options allows companies to set an exercise price at's lower an e current value of e company's stock. is makes e options in- e-money for e grantee (e Smi, in our example), basically giving her options at are instantly profitable. e Stock Options Backdating Scandal: D&O Implications. By McCarrick, John F.. Pesso, Maurice. Read preview. Article excerpt. As e current wave of stock option backdating investigations and shareholder derivative lawsuits sweeps rough e D&O industry, is is a good time to step back, consider what is at stake in ese cases Options backdating. Ading employees wi stock options ose are dated prior to e actual grant date. e date chosen could be one when e company’s stock was at a low, so e options can. e tech industry's stock option backdating scandal appears to be ga ering steam. Last week, federal investigators announced criminal charges against former executives of Brocade Communications. 29, 2006 · TV. More. United States. Business News. uary 19, 2007 / 8:36 AM / 14 years ago. Stock option backdating scandal could grow: report. Emily Chasan. 5 Min Read. NEW YORK (Reuters) - e stock. 21, 20 · Apple was alleged to have backdated a number of options. (e practice seems to have been particularly popular in e tech sector.) In 2007, New . 23, · ANN ARBOR—A ade after e stock option backdating scandal broke and en seemed to die down after some civil and criminal prosecutions, e practice appears to have resurrected itself. Nejat Seyhun, professor of finance at e University of Michigan’s Ross School of Business, was among e first to detect e practice at allowed. What does e stock-option backdating scandal mean for your mutual funds? An analysis of options ads at a number of companies shows at shares of some have taken big hits. 22, 2006 · After e greed and accounting saga of e late 1990s, e stock-options backdating scandal now pounding nearly two dozen companies might seem a . , 2007 · e stock option backdating scandal has ensnared almost 200 companies, according to company disclosures at have revealed internal investigations as . 12, 2006 · e causalities were just e latest in a widening scandal over backdating stock option grants. McAfee fired President Kevin Weiss Kevin Weiss . 23, 2008 · Back to e Backdating Scandal: Today, UnitedHeal It settles wi e SEC, but extraordinary cooperation helps e company avoid fraud charges or a monetary penalty. Stephen Taub. By settling its civil stock-option backdating case, UnitedHeal Group Inc. — and also its former general counsel — has wrapped up one of e biggest. 30, 2006 · And wi at least 152 companies cht up in e options-backdating scandal, it is likely at still more have to take charges. Glass Lewis said a total of 153 companies had disclosed backdating problems since ch, when a series of reports in . Testimony Concerning Options Backdating. by Christopher Cox Chairman, U.S. Securities and Exchange Commission. Before e U.S. Senate Committee on Banking, Housing and Urban Affairs 6, 2006. Chairman Shelby, Ranking Member Sarbanes, and Members of e Committee: ank you for inviting me to testify today about options backdating. 21, 20 · At its height, e backdating scandal touched dozens of local companies at came under federal investigation or launched eir own accounting reviews, which led . 06, 2007 · Former UnitedHeal Group Inc. Chairman and CEO William McGuire has agreed to surrender more an $400 million to settle a lawsuit related to a stock-options backdating scandal. 15, 2006 · Amkor Technology Inc., a semiconductor packaging company, has become e latest victim in e U.S. Securities and Exchange Commission’s probe into stock options backdating. e settlement comes a year after e options-backdating scandal led to Dr. McGuire's ouster from e Minnetonka, Minn., company, one of e largest U.S. heal insurers. Feb 15, 2007 · 2007-02-15 12:11:07 PST Major developments in e options backdating scandal are coming fast and furious ese days, including e first two criminal convictions of executives and new. 22, 2006 · e feds have fired eir first official salvo in e stock-options backdating scandal, filing criminal and civil charges against executives at San Jose's Brocade Communications Inc. on ursday. 19, 2006 · e stock-option backdating scandal could spark a flurry of small D&O claims from companies, mostly in e technology sector. Roughly 60 companies, including Analog Devices ADI. Option grant backdating investigations and capital ket discipline Kenne Carowa,1, Randall Herona,2, Erik Lieb,3, Robert Neala,⁎ a Kelley School of Business, Indiana University, Indianapolis, IN 46202, United States b Henry B. Tippie College of Business, University of Iowa, Iowa City, IA 52242, United States article info abstract Article history. 17, 2006 · For now, e stock-option backdating scandal hasn't widely influenced e job ket, says Stephen Mader, vice chairman at executive search firm Christian & . e SEC is getting ready to charge Apple's former GC, Nancy Heinen, wi securities fraud in Apple's option backdating scandal, e Mercury News reports. e SEC is looking into Heinen's role in ading Steve Jobs stock options but also at a second round of grants in which various executives, including Heinen herself, profited from backdating. McAfee has taken two major steps tod closing e stock-option backdating scandal at has plagued e company for e past two years. On Friday, e security vendor filed years' wor of. is study examines events at e conclusion of e 2006 stock option backdating scandal: e departures of C-level executives from firms implicated in backdating. e au ors ask whe er removing.