Several board-level directors at Apple, including CEO Steve
Jobs, are facing a repeat litigation battle as they are sued for
their connection to the company's
stock options backdating affair.
The allegations against both current and former employees of
Apple amount to
Jobs being accused of fraud. Back in June 2006, Apple agreed it
had shown irregularities in its stock option grants between 1997
and 2001 and that one of the grants was initially given to Jobs.
Subsequently the company said the grant it had been "cancelled and
resulted in no financial gain to the CEO".
The latest case, filed to a federal court on Friday of last
week, sees a group of executives and directors charged over
allegations of Apple manipulating and backdating a particular set
of stock option grants.
Apple has been under close scrutiny since it reported
record sales for its second quarter in April this year, which
it followed with a
defence of Jobs amid these hefty profits.
The company's backdating of option grants was done to benefit
from better
"exercise
prices" for the grants, a process that is legal if fully
disclosed.
So far, Jobs has escaped prosecution by both the state and
federal authorities, while the company's own internal
investigations have vindicated his actions. Less fortunate is
Apple's former head lawyer,
Nancy Heinen, who resigned from the company in 2006 and faces a
lawsuit filed by the Securities and Exchange Commission.
Reports suggest Apple's initial legal wrangle in 2006 may have
reduced the shareholder value of its stock by as much as $7 billion
at the time. But since the 2006 action, Apple's stock has tripled
because of healthy sales across its entire product line.