Which GCs Are Most at Risk in Backdating Cases?

Firm partner’s research shows that general counsel who understood backdating’s accounting implications are getting hit hardest

Corporate Counsel
January 3, 2008

Why is the government taking action against some general counsel who backdated stock options, while letting others off the hook? According to John Villa, the key is whether GCs knew that backdating creates an accounting problem. If they did — and did nothing to fix it — they’re more likely to face a civil suit from the Securities and Exchange Commission or criminal charges from the U.S. Department of Justice.

Villa, a partner at Williams & Connolly, reached his conclusion after looking at the cases of seven general counsel who face criminal or civil charges for backdating. He recently published his findings in ACC Docket, the magazine of the Association of Corporate Counsel. Though Villa’s article does not name all of the seven legal chiefs that he studied, they are Lisa Berry of KLA-Tencor Corp. and Juniper Networks Inc.; Nancy Heinen of Apple Inc.; Myron Olesnyckyj of Monster Worldwide Inc.; Kent Roberts of McAfee Inc.; Kenneth Selterman of Take-Two Interactive Software Inc.; Susan Skaer of Mercury Interactive Corp.; and William Sorin of Comverse Technology Inc.

For more see law.com.

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