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12-17-2009, 08:32 PM
Charges of fraud and conspiracy in the Broadcom stock-option backdating case have been dropped against two company executives. Due to misconduct on the side of the prosecution, the U.S. District Court threw out the charges. In the same breath the Security and Exchange Commission's civil case was also thown out against the four original executives being charged: former Chairman and CTO Henry Samueli, former general counsel David Dull--who both took leaves of absence from their positions--former CEO Henry Nicholas, and former CFO William Ruehle. Last week, the judge also dismissed Samueli's guilty plea to the charge of lying investigators and dropped the felony charges determining that Samueli was vague and evasive but did not lie.
The court found that prosecuters attempted to prevent three defense witnesses from testifying through intimidation and leaks to the media. The improper conduct was described as making "a mockery of the constitutional right to due process and a fair trial" by the judge who claimed that the actions of the lawyers had prevented the essential fact finding of the trial.
Broadcom--a supplier of IP phone chips to many of the world's VoIP equipement manufacturers including: Alcatel, Avaya, Nortel, NEC, Inter-tel, and Toshiba--fell victim to the stock-option backdating scandal in 2008 when the SEC charged four Broadcom executives with backdating then covering it up the between 1998 and 2003. In the summer of 2006 the company admitted it would need to re-state earnings for several years because of a series of suspect options transactions. Broadcom took a $2.2 billion charge against earnings.
For more:
- read the New York Times article (http://www.nytimes.com/2009/12/16/technology/companies/16broadcom.html?ref=technology)
- read this LA Times story (http://www.latimes.com/business/la-fi-samueli10-2009dec10,0,7251404.story)
Related articles
SEC: Broadcom back-dated options (http://www.fiercetelecom.com/story/sec-broadcom-officials-back-dated-stock-options/2008-05-15)
Broadcom intros new VoIP chipset (http://www.fiercevoip.com/story/broadcom-intros-new-voip-chipset/2009-03-16)
Broadcom offers open source HD Voice (http://www.fiercevoip.com/story/broadcom-offers-open-source-hd-voice/2009-11-11)
More... (http://www.fiercevoip.com/story/charged-dropped-broadcom-stock-option-backdating-case/2009-12-17?utm_medium=rss&utm_source=rss&cmp-id=OTC-RSS-FV0)
The court found that prosecuters attempted to prevent three defense witnesses from testifying through intimidation and leaks to the media. The improper conduct was described as making "a mockery of the constitutional right to due process and a fair trial" by the judge who claimed that the actions of the lawyers had prevented the essential fact finding of the trial.
Broadcom--a supplier of IP phone chips to many of the world's VoIP equipement manufacturers including: Alcatel, Avaya, Nortel, NEC, Inter-tel, and Toshiba--fell victim to the stock-option backdating scandal in 2008 when the SEC charged four Broadcom executives with backdating then covering it up the between 1998 and 2003. In the summer of 2006 the company admitted it would need to re-state earnings for several years because of a series of suspect options transactions. Broadcom took a $2.2 billion charge against earnings.
For more:
- read the New York Times article (http://www.nytimes.com/2009/12/16/technology/companies/16broadcom.html?ref=technology)
- read this LA Times story (http://www.latimes.com/business/la-fi-samueli10-2009dec10,0,7251404.story)
Related articles
SEC: Broadcom back-dated options (http://www.fiercetelecom.com/story/sec-broadcom-officials-back-dated-stock-options/2008-05-15)
Broadcom intros new VoIP chipset (http://www.fiercevoip.com/story/broadcom-intros-new-voip-chipset/2009-03-16)
Broadcom offers open source HD Voice (http://www.fiercevoip.com/story/broadcom-offers-open-source-hd-voice/2009-11-11)
More... (http://www.fiercevoip.com/story/charged-dropped-broadcom-stock-option-backdating-case/2009-12-17?utm_medium=rss&utm_source=rss&cmp-id=OTC-RSS-FV0)