In the midst of all the iPod hoopla, The National Law Journal revealed court documents that confirm Apple CEO Steve Jobs, along with other members of Apple’s current and former management team, have agreed to pay up to $14 million to resolve the 20 outstanding investor derivative law suites over backdated stock options.
Derivative law suites are those filed by participating shareholders on behalf of the corporation, in this case Apple. Together, the company and shareholders charge officers who allegedly harmed the company as a whole. Restitution from the litigation’s is awarded to the company, not the individual plaintiffs
In this case, the 20 or so derivative suits stemmed from “irregularities discovered in option grants to Apple officers between 1997 to 2002, incurring Apple expenses of $84 million in non-cash stock based compensation.” (Officers Fred Anderson and Nancy Heinen, the only employees to be charged on the federal level, settled earlier this year with the SEC, paying fines and sanctions.)
As reported earlier by MacBlogz.com. executives listed as defendants included CEO Steve jobs; former CFO Fred Anderson and current CFO Peter Oppenheimer; COO Timothy Cook, former general counsel Nancy Heinen; and senior VP Ronald Johnson. While Apple officers have denied any wrongdoing, they have collectively acknowledged that litigation would, “impose extensive and unrecoverable costs in the form of attorneys’ fees and expenses.” The plaintiffs of the case stated that the settlement “provides an excellent monetary recovery.”
The details of the settlement are due for final approval at a hearing on October 31th.
Apple is in the midst of some other legal trouble at the moment as well. They have an on-going case with Mac clone maker Psystar, they just admitted (in court) that the iPod was invented by Kane Kramer (and settled with Burst.com), and it seems that people are suing them left and right over poor iPhone 3G performance, or the shaky AT&T cellular network reception.
