SAN JOSE (CN) – Apple computer boss Steven Jobs improperly backdated stock options for himself and other Apple executives to the tune of $105 million from 1997 to 2002, shareholders say in a derivative claim in Santa Clara County Court.
“Rather than blame Jobs and/or other members of current management, Apple has tried to shift all the blame to two former employees, former CEO Fred D. Anderson and former general counsel Nancy R. Heinen, both of whom had abruptly resigned, and both of whom had been sued by the Securities and Exchange Commission in connection with their participation in the backdating scheme,” the complaint states. “Although these two undoubtedly did participate in the scheme, the notion that they alone are solely to blame for five years of backdated options, each of which was approved by the directors of the Company, is not credible.”
The complaint adds that when Apple rehired Jobs in 1996, “Unfortunately, Jobs brought with him the nasty habit of options backdating, which was also prevalent at the GAP and Pixar, where Jobs has also been a director.”
The complaint continues: “Apple had taken the position that because the options granted to Jobs were later canceled, there has been no harm to the Company, and therefore no foul.” However, it adds, “Since Jobs was allowed by the Board to exchange his backdated options for 10 million split-adjusted shares of stock, he did, in fact, obtain a financial benefit from the backdated options to the extent to which the number of shares into which the options were exchanged were based upon the value of the options. When the restrictions on Jobs’ new shares lapsed three years later, on March 19, 2006, they were worth approximately $640 million. According to a Bloomberg report, title ‘Apple’s Jobs Should Give Back the $85 Million,’ Jobs unjustly benefited from the exchange of his backdated options by $84 million, utilizing the stock prices as of March 19, 2006.”
Plaintiffs, the Boston Retirement Board, are represented by H. Adam Prussin with Pomerantz Haudek Block of New York, N.Y.