Backdating and the Fate of Generals Counsel Who Leave the Gate Wide Open

Will Ex-Comverse GC’s Plea Deal Be a Benchmark?
Jessie Seyfer
Legal Pad
January 17, 2007

When we saw last week that the Securities and Exchange Commission had settled its case against William Sorin, the former general counsel of Mass.-based Comverse Technology, we wondered whether the same fate awaited the many displaced general counsel here in Silicon Valley who are very probably under SEC suspicion too.

After all, sources say McAfee’s former GC Kent Roberts is likely to be criminally indicted soon. Apple’s former GC Nancy Heinen is also under a cloud, as is CNET’s ousted GC, Sharon Le Duy. Mercury Interactive’s general counsel, Susan Skaer, resigned because of involvement in backdating activities in November 2005.

The SEC ordered Sorin, who pleaded guilty in November to criminal charges in connection to backdating of stock options, to pay more than $3 million in civil penalties, disgorgement and prejudgment interest. He was also banned from ever serving as an officer or director at a company and suspended from practicing before the SEC.

In a press release about the settlement, Linda Chatman Thomsen, director of the SEC’s enforcement division, made it pretty clear this wouldn’t be the last of the backdating settlements: “Today’s settlement signals that the Commission will vigorously pursue those responsible for backdating schemes wherever the investigation may lead, even, as appropriate, into the offices of corporate counsel.”


For more see Click here for a copy of the SEC press release.


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