It was the pseudo-scandal launched by the Wall Street Journal's investigative unit, after its reporters began following up on an academic report that demonstrated many executive stock options awards were too well-timed to be plausible.
The basic idea was that many companies seemed to award stock options on days when their stocks were at low-points, which increased the value of the options when the stock increased and made the stock cheaper to buy for the executives.
We'd all have been better off if backdating was seen for what it really was: a rational response to an irrational accounting rule.
Anyway, Apple was alleged to have backdated a number of options.
Insurers representing Jobs and Apple's board will pay Apple, Inc.
million, which tidily covers almost million in attorney's fees and expenses.
It dominated the business press in 20, right when the financial world was crumbling.
Here's how Ira Stoll from Future of Capitalism, describes the terms of the settlement: Ted Frank, the president of the Center for Class Action Fairness and a leading tort-reform advocate, is making the case that the settlement is worse than nutty and unfair. Indeed, it seems the center is planning to contest the settlement in court, provided it can find people who invested in Apple between 20 who are willing to be named as plaintiffs. Surely there are plenty of Apple investors who don't want to see Apple pay .5 million to settle this kind of nuisance lawsuit.
Under the Ninth Circuit's Six Mexican Growers precedent, a court should not be issuing cy pres* that is not likely to benefit the class members.
And as the Center for Class Action Fairness noted in recent Ninth Circuit briefing, the American Law Institute has said that cy presis inappropriate where class members are readily identifiable.
See this post at the glom for commentary by Gordon Smith and a collection of links to discussion on other blogs.
As for option backdating, I think directors on compensation committees of companies embroiled in the backdating scandal (or perhaps more accurately, D&O insurers) can breathe a sigh of relief following , at least with respect to personal liability under state corporate law.