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Apple Settles Backdating Lawsuit for $20.5 Million

By - Source: Tom's Hardware US | B 20 comments

Apple has settled a class action suit and agreed to pay shareholders millions of dollars in a case relating to backdated stock options.

Apple has finally settled a four-year-old class-action lawsuit filed by the New York City Employees' Retirement System relating to backdating stock options. The company has been ordered to pay $14 million to shareholders, $2.5 million to fund corporate-governance programs at Columbia and Stanford and an additional $4 million in legal fees.

AppleInsider reports that in December 2000, Steve Jobs approved an options grant for Apple's top executives, but the grant wasn't finalized until January 31. When it was later revealed that the stock options were dated for January 17, Apple was accused of backdating the options.

This is not the first lawsuit relating to the backdating scheme, though. In 2008 Apple settled a similar suit relating to the matter and paid $14 million to Californian shareholders. The company was also subject to a 2007 SEC investigation that saw former CFO Fred Anderson and former general counsel Nancy Heinen charged. The two agreed to a settlement without admitting wrongdoing and were fined and ordered to repay millions of dollars in illegal gains.

Source: Apple Insider, Market Watch

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  • 12 Hide
    MiamiU , October 8, 2010 2:12 AM
    sparky_the_lab_ratI'm confused... the year 2000 execs essentially stole millions from the corporation, and in turn the year 2000 stockholders. As punishment, the corporation, basically the year 2010 stockholders, need to repay the year 2000 stockholders for their loss. Doesn't this just change who the victim is while the perps keep their looted money?

    welcome to capitalism
  • 10 Hide
    sparky_the_lab_rat , October 8, 2010 1:40 AM
    I'm confused... the year 2000 execs essentially stole millions from the corporation, and in turn the year 2000 stockholders. As punishment, the corporation, basically the year 2010 stockholders, need to repay the year 2000 stockholders for their loss. Doesn't this just change who the victim is while the perps keep their looted money?
Other Comments
  • 4 Hide
    everlast66 , October 7, 2010 10:54 PM
    After the settlement was agreed Jobs paid the $5 mil straight away from his pocket money :) 
  • 3 Hide
    jvc21 , October 8, 2010 12:59 AM
    dude, aren't Apple execs rich enough already?

    Is it really that important to get that extra million through backdating when you've already stashed tens of millions of dollars? >_
  • 9 Hide
    oxxfatelostxxo , October 8, 2010 1:04 AM
    Its apple being apple, no new news here. Move on
  • 5 Hide
    rohitbaran , October 8, 2010 1:10 AM
    All those lawsuits are just a small hole in Apple's pocket. With its loyal fanbase, it can always break rules and later pay a small (from its viewpoint) price and not break a sweat.
  • 9 Hide
    rohitbaran , October 8, 2010 1:11 AM
    everlast66After the settlement was agreed Jobs paid the $5 mil straight away from his pocket money

    Really, I think it might have caused terminating the free bumper program! Poor iCrap buyers! :D 
  • 10 Hide
    sparky_the_lab_rat , October 8, 2010 1:40 AM
    I'm confused... the year 2000 execs essentially stole millions from the corporation, and in turn the year 2000 stockholders. As punishment, the corporation, basically the year 2010 stockholders, need to repay the year 2000 stockholders for their loss. Doesn't this just change who the victim is while the perps keep their looted money?
  • 12 Hide
    MiamiU , October 8, 2010 2:12 AM
    sparky_the_lab_ratI'm confused... the year 2000 execs essentially stole millions from the corporation, and in turn the year 2000 stockholders. As punishment, the corporation, basically the year 2010 stockholders, need to repay the year 2000 stockholders for their loss. Doesn't this just change who the victim is while the perps keep their looted money?

    welcome to capitalism
  • -2 Hide
    dEAne , October 8, 2010 3:40 AM
    It ruin the apple.
  • 0 Hide
    alyoshka , October 8, 2010 5:17 AM
    Now that's a 20 Million $ Apple...... :( 
  • -4 Hide
    silentq , October 8, 2010 11:42 AM
    i wouldn't be surprised if next economical crysis will be caused by Apple going bankrupt due to law suits and crappy products... The world just cannot survive without the iProducts... 2012 disaster anyone?
  • 5 Hide
    Elsapo , October 8, 2010 1:05 PM
    Quote:
    The two agreed to a settlement without admitting wrongdoing and were fined and ordered to repay millions of dollars in illegal gains.
    Money has perks, I wonder if a shoplifter would have been treated so nicely.

  • 2 Hide
    mchuf , October 8, 2010 2:14 PM
    everlast66After the settlement was agreed Jobs paid the $5 mil straight away from his pocket money


    He should. I'm sure he was the one who benefited the most out of this.
  • 1 Hide
    hellwig , October 8, 2010 2:55 PM
    ElsapoMoney has perks, I wonder if a shoplifter would have been treated so nicely.

    I get your point, buy I dunno about the analogy. How many stupid kids are kicked out of a store and told never to return when they're caught shoplifting?

    I think the better analogy would be armed robbery. "Well, say your sorry, pay a small fine, and promise that you'll try extra-hard not to do it again. And of course you can keep your gun."
  • 4 Hide
    dustcrusher , October 8, 2010 3:10 PM
    silentqi wouldn't be surprised if next economical crysis will be caused by Apple going bankrupt due to law suits and crappy products... The world just cannot survive without the iProducts... 2012 disaster anyone?


    The next economical Crysis would be one that can actually be played with high settings on a machine that costs less than a grand.

    I'm here all weekend, folks...try the veal.
  • 2 Hide
    theoutbound , October 8, 2010 4:34 PM
    Eh, more of the same. Apple is no different than any other corporation, and I've come to expect this kind of behavior from everyone. I'm just curious how Apple fans will spin this in Job's favor.
  • 1 Hide
    eddieroolz , October 8, 2010 5:50 PM
    Nothing new here. Apple just doing what it does best.
  • 1 Hide
    tu_illegalamigo , October 8, 2010 8:29 PM
    Just wait, someone will get them on something big. Or they`ll become mainstream and have malware out the ass. Let`s see their simple, elegant, "magical" devices fight off the Russians.
  • 0 Hide
    ricdiculus , October 8, 2010 9:08 PM
    @ DUSTCRUSHER:
    That, Is funny.
  • 0 Hide
    beayn , October 9, 2010 10:15 PM
    Doesn't Apple have upward of $40 billion in excess cash on hand? This is a drop in the bucket.