Xilinx, Maxim Subject of More Stock-Option Litigation
Staff Reporter -- EDN, June 15, 2006
A second lawsuit has been filed in the U.S. District Court for the Northern District of Calif. against certain officers and directors of Xilinx Inc. as a result of allegations concerning improper backdating of Xilinx options granted to company employees.
The first suit was filed on June 2.
The law firm Finkelstein, Thompson & Loughran said it is investigating similar claims at this time and welcomes inquiries from shareholders concerning their rights and interests in this matter.
Click here for more news on the unfolding stock option investigation.
This lawsuit in the wake of news reports indicating Xilinx appears to have backdated option grants so their exercise price correlated to a day on or near the day Xilinx stock hit its low price for the year, or directly in advance of sharp increases in the price of Xilinx stock, according to a statement by the firm today.
The complaint filed alleges the defendants mismanaged corporate assets and breached their fiduciary duties between 1998 and June 2 by authorizing or failing to halt the back-dating of certain stock options, and if true, could potentially require restatement of Xilinx's financial reports and could create additional tax and legal liabilities for the company, the firm also said.
In other stock-option-related news, the same firm said it has filed a lawsuit in the U.S. District Court for the Northern District of Calif. against certain officers and directors of Maxim Integrated Products Inc. as a result of allegations concerning improper backdating of Maxim options granted to Maxim employees.
The Securities and Exchange Commission (SEC) recently began an informal inquiry into Maxim’s stock options grants and practices.
The inquiry against Maxim arose in the wake of news reports indicating Maxim appears to have backdated option grants so their exercise price correlated to a day on or near the day Maxim stock hit its low price for the year, or directly in advance of sharp increases in the price of Maxim stock, the firm noted.
These allegations, if true, could potentially require restatement of Maxim's financial reports and could create additional tax and legal liabilities for Maxim, the firm concluded.
These suits are a few of the latest in the growing number of semiconductor companies under scrutiny for their stock option granting practices.
