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November 21, 2007

Apple Shareholders to Pursue Suit Over Stock Options

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Even when you think you've outrun the bears, jumped over the quicksand and escaped the robots with laser arms, there are always the shareholders to contend with.

According to Macworld UK, a group of Apple shareholders have confirmed plans to re-file a lawsuit against Apple regarding its backdating of stock options.

The decision comes after judge Jeremy Fogel of the United States District Court for the Northern District of California rejected claims of fraud raised by the shareholders back on Monday. Fogel did not allow the litigants the chance to revise their complaint, which the shareholders have confirmed they intend to do.

Instead, the judge sided with Apple, stating that the alleged false proxy statements cited in the case landed beyond the statute of limitations and granted the plaintiffs an option to amend their complaint in order to change their argument. Describing the plaintiff's argument as "too general", Fogel requested more detail.

Earlier this year, an SEC probe was launched into Apple to investigate options grants which had been awarded despite the dates of these grants being changed to allow for better profits.

The initial lawsuit was filed on June 30th, 2006 and claimed that Apple directors and officers, including CEO Steve Jobs, failed to perform their jobs correctly and lied to shareholders when they backdated option awards made between 1997 and 2001. The shareholders are currently requesting that any backdated options or profits on strength of these option grants be returned to the company.

Last week, the same judge rejected a similar shareholder lawsuit involving a New York pension scheme but also offered the plaintiffs in that case the chance to re-file their claims by joining the Apple case.

Let us know what you think over in the comments or forums.

Posted by chrisbarylick at November 21, 2007 10:04 AM
Category: Legal
Buy from: Apple, iTunes, Amazon.

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Comments

If shareholders want to sue some corporation how about one where the Top executives are making 7 figure salaries and the company is barely making a profit. At least with Apple Steve is being rewarded for performance above his $1 a year salary. If the company performs the stock price goes up and Steve and the other executives get hefty bonuses.

Posted by: Kenn Marks at November 21, 2007 10:44 AM

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