“Apple Inc. won dismissal of a shareholder lawsuit claiming company officers including Chief Executive Officer Steve Jobs were overpaid with illegally backdated option awards,” Joel Rosenblatt reports for Bloomberg.
“U.S. District Judge Jeremy Fogel in San Jose, California, dismissed the case in an order [yesterday]. Apple, maker of the iPod and iPhone music-and-video players, said last year that 6,428 stock-option grants issued between 1997 and 2002 were backdated,” Rosenblatt reports.
The New York City Employees’ Retirement System, the lead plaintiff in the case, acknowledged that Apple’s stock price didn’t fall as a result of the backdating, which is the most common basis for shareholder claims [but] argued the awards caused Apple to dilute its stock by issuing more than 200 million shares that weren’t properly accounted for or disclosed,” Rosenblatt reports. “‘While the subsequent disclosure that the options were backdated might require a restatement, without a discernable drop in the stock price there is no basis upon which to establish an injury to shareholders,’ Fogel wrote in his opinion.”
Rosenblatt reports, “Apple, based in Cupertino, California, found no misconduct by Jobs, who recommended favorable dates on some option grants other than his own. The company recorded $84 million in charges to correct its accounting.”
Full article here.
[Thanks to MacDailyNews Reader “Linux Guy And Mac Prodigal Son” for the heads up.]