Pension Fund Stock Options

San Jose, CA: (Oct-15-07) A lawsuit was brought against Mercury Interactive, by a group of pension funds, alleging that there were concerns about the company's stock options practices. As part of a settlement reached, Mercury Interactive agreed to pay $117.5 million to resolve allegations. This move came after the company settled with the US Securities and Exchange Commission, over options backdating, paying the agency $28 million. The SEC also brought charges against four top former executives of the company, claiming that the four perpetrated a fraudulent and deceptive scheme from 1997 to 2005 to award themselves and other employees undisclosed, secret compensation by backdating stock option grants, failing to record hundreds of millions of dollars of compensation expense, and falsifying documents to further this scheme. The recent settlement was reached after Mountain View-based Mercury Interactive, was acquired by Palo Alto-based Hewlett-Packard Co. in 2006, for a sum of $4.5 billion. [SAN JOSE BUSINESS JOURNAL: PENSION FUND STOCKS]

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Published on Oct-16-07