An Associated Press article reports that CEO Steve Jobs and other senior executives have settled a lawsuit claiming they had mishandled stock option awards. This means the Insurers of Jobs and other executives have to pay Apple Inc. $14 million, $9 million of which are lawyer fees.
This is a complicated series of lawsuits that lead to the stock backdating scandal at Apple. In most stockholder lawsuits the stockholders must prove the stock price was hurt by the actions of the defendants. Because of accounting problems after the options-backdating, stock price is rarely affected this then becomes a “derivative lawsuit.”
A derivative lawsuit is is when shareholders sue executives individually on behalf of the company, claiming harm came to the company. The executives settled with Apple and the shareholders for $14 million is exchange to drop the lawsuit.
A final settlement hearing is planned for October 31. Happy Halloween indeed.
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TAGS: Steve Jobs
