“Life for Apple’s lawyers became even busier this week after a fourth lawsuit over stock options allegedly granted on the wrong dates was filed,” Colin Barker reports for ZDNet UK.
Barker reports, “On Tuesday, lawyers acting on behalf of Apple shareholders filed actions against the company claiming that it ‘manipulated options grants to sell more than US$1 billion in company stock,’ according to Bloomberg News.”
“At least three other actions along similar lines have already been placed in U.S. courts. The lawsuits all claim that the company’s chief executive, Steve Jobs, and other executives backdated their share options, and later cashed them in shortly before Apple’s stock price fell,” Barker reports.
Full article here.
Related articles:
How options-backdating irregularities can affect your Apple Computer stock – August 23, 2006
Apple’s options imbroglio: Mac-maker granted options at or near key events in company’s history – August 18, 2006
Apple added to Nasdaq’s list of ‘delinquent companies’ – August 18, 2006
Apple unlikely to be delisted by NASDAQ – August 16, 2006
Apple CEO Steve Jobs drawn into stock options scandal – August 15, 2006
Apple announces update regarding stock option grants – August 11, 2006
As expected, Apple delays quarterly results due to stock-options grants review – August 11, 2006
Some stock options grant decisions were made by Apple board, and potentially, CEO Steve Jobs – August 10, 2006
Disney: no material impact from Pixar options – August 09, 2006
Pixar options draw scrutiny – August 08, 2006
Apple stock options scandal? What scandal? – August 07, 2006
Class action lawsuit over stock options filed against Apple Computer, Inc. – August 04, 2006
Wall Street forgiving of Apple’s stock option irregularities; CEO Jobs unlikely to be terminated – August 04, 2006
Apple’s stock option irregularities escalate into a scandal as world awaits Steve Jobs’ WWDC keynote – August 04, 2006
Apple warns of profit restatement dating back to 2002 – August 04, 2006
Apple loses 3.5% to $67.15 in premarket trading – August 04, 2006
Apple announces update regarding stock option grants – August 03, 2006
Shareholder’s options suit against Apple alleges ‘striking pattern that could not have been chance’ – July 11, 2006
Apple announces update regarding stock option grants – July 05, 2006
UBS: stock options probe unlikely to hurt Apple – June 30, 2006
Apple joins growing list of companies entangled in stock option ‘irregularities’ – June 29, 2006
Apple to investigate stock option grant ‘irregularities’ made between 1997 and 2001 – June 29, 2006
Stop the lawyer bashing:
The problem is, SOME lawyers are nothing but vultures. Most typically in these kind of lawsuits, it is the lawyers who immediately begin soliciting potential clients who agree to file a grievance.
In the class action suit about the scratchability of the iPod nano, the law firm didn’t even get the permission of the person they contacted before filing the lawsuit “on his behalf.”
Let me repeat that again. The person whose name is on the iPod nano lawsuit EXPRESSLY told the law firm that he was not interested in taking any legal action, yet the law firm was so excited at the prospect of making millions of dollars in class action damages, that it went ahead and used his name anyway.
When the guy later complained and publicly wrote about this misuse, the law firm actually sicced its lawyers on him, threatening to basically ruin him financially for actually having the gall to undermine a shoddy, greed-driven lawsuit.
We are not talking about lawyers who defend people from false criminal charges or seek payment for injuries from, say, a coal-mining disaster.
The type of lawyers that pursue these types of lawsuits are motivated solely by the prospect of money. I would be very surprised if shareholders actually approached them, rather than the lawyers shopping for shareholders who agree to be useful idiots in the whole fiasco.
It’s hard to file grievances, for example, when no one but Apple’s investigation team knows exactly what has happened with regard to options. Just typical greedy vultures jumping so they can be at the head of the line.
Well put NewType, and I can see your point, and I am pleased that you differentiated between those lawyers who are dedicated to the cause, and those that are out to turn a quick buck. Unfortunately these types exist everywhere.
Zeke et al…
When you wake up every morning and wipe the sleep from your eyes and run off to work, what are you doing it for; fun? I bet that paycheck helps get you out the door just a little bit.
I get so sick of hearing how lawyers are only in it for the money. What the hell are they supposed to be in it for? Why do any of us go to work?
I charge $150 an hour for advertising design. Sally the secretary that just got a copy of M$ publisher and thinks she’s a designer would call me a vulture. Until her project went to press of course.
But in case you guys really do like to do a job for free, I have a ton of graphic design work I’d love to give to you. The pays great and the benefits are good…if you like to work for nothing.
Zeke,
Sorry my post was aimed at NEW TYPE, not you.
Wish you could edit a post…
“To split hairs over management compensation for a team that produced that kind of results is insane. “
Coming back to the Clinton argument. It’s not the level of compensation that’s the problem. Properly documented nobody would care. It’s the LYING that’s the problem.
“hurting my considerable investment in the company. “
Well sorry. But you either accept that that will happen, or sell. Can’t blame shareholders for pursuing their legal rights when they’ve been lied to. You can only blame yourself for continuing to hold a stock when it should be OBVIOUS that these kind of suits would have followed the wrongdoing. The only logical reason to continue to hold Apple is if you think that it’s still a good investment despite having to pay out on these suits. And if that’s the case, quit whining.
“Apple and its customers, along with true “investors” in the company will all pay the price.”
If a “True” investor is one who’d rather be lied to by management than told the truth, and have lies covered up with no consequences then I have another definition. That’s a dumb, ignorant investor.
Nobody really cared that Enron management was lying to them when they were making money hand over fist. But now, they seem to care. What if Apple management suddenly starts lying over iPod shipments etc. Will that be OK as long as the stock goes up?
Apologist- Zeke,
Of course it’s okay to lie as long as the stock goes up. Just ask Zeke and his considerable investment.
But if Apple management were lying about other things causing the stock to go up artificially how would Zeke feel about his considerable investment when the lies finally crash and his stock becomes worthless.
We’ll all turn a blind eye if we’re making money; it’s the losing of money that makes me see a little more clearly.
As others have stated, just ask the ENRON shareholders that were lied to.
“But if Apple management were lying about other things causing the stock to go up artificially how would Zeke feel about his considerable investment when the lies finally crash and his stock becomes worthless.”
The answer is simple: He’d feel just fine when the stock is going up, and blame it on some Microsoft conspiracy when it crashed.
To the tag team:
Some people just don’t get it. To shoot a goose because it only lays gold eggs and not platinum ones is really, really stupid.
Zeke,
No, you don’t get it. The point is if they are lying it may not be gold eggs…it could be just gold painted eggs. If they’ve cooked the books once, how do you know they haven’t cooked them elsewhere? Lie about units shipped here; embellish units shipped there and eventually the stock tanks.
That’s the point of having accountability. It’s not to punish people for making money; it’s to keep them from stealing it at your and my eventual expense.
We’ve established lying and stealing money is okay with you as long as you’re making money too.
The question for you is: If what they lied about made your considerable investment go down, would that also be okay with you? I’m talking ENRON down here. I doubt it.
“Some people just don’t get it. To shoot a goose because it only lays gold eggs and not platinum ones is really, really stupid.”
To repeat: The problem’s not with their compensation. Properly accounted for, no-one would care.
The problem is that management thought they could get away with LYING (in financial statements) about how much compensation they were giving themselves.
Today in America, that’s illegal.
Here’s the analogy: You own a company, you have a super salesman called Joe. Joe brings big deals into the company. You find out he’s stealing from you. Because he also does the company books, you don’t know quite how much he’s stealing, but you know it’s a big number.
do you:
a) Live with it, because best as you can tell, Joe’s stealing much less than he’s bringing in.
b) Fire Joe on principal, because you don’t believe in employing dishonest people.
c) Wait and see, if it turns out that Joe’s doing some real damage to the company, fire him then.
d) Take Joe for a drive out into the woods.
So back to Apple. If they’ll under-record what they’re paying themselves in the financials, who knows what else they’re prepared to falsify when faced with decline in the stock price and loss of personal wealth, or just take without saying because they believe they’re owed it. Enron, Tyco anyone?