Broadcom founders named as “unindicted potential co-conspirators” in stock-option investigation
A federal district judge told prosecutors that not identifying Henry T. Nicholas III and Henry Samueli would undermine the factual basis of the plea deal and violate the principles of open court hearings, according to reports.
By Suzanne Deffree, Managing Editor, News -- EDN, January 25, 2008
Broadcom Corp founders Henry T. Nicholas III and Henry Samueli were named as “unindicted potential co-conspirators” by federal prosecutors Thursday in an investigation into the communication company’s backdating of stock options, according to reports.
The federal prosecutors’ identification came this week as a former human resources executive, Nancy M. Tullos, pleaded guilty to obstruction of justice, according to reports. Last year, Tullos agreed to the plea in exchange for her cooperation.
Nicholas and Samueli were identified as “Executive A” and “Executive B” in the plea deal, however, a federal district judge told prosecutors that not identifying them would undermine the factual basis of the plea deal and violate the principles of open court hearings, according to reports.
Broadcom in January 2007 re-filed financial statements with total net additional charges of $2.22 billion for illegally backdated stock-option grants. At that time, no option grant requiring a measurement date revision was awarded to and Nicholas and Samueli.
The $2.2 billion fine was more than the $1.5 billion the company previously projected it would have to pay and followed a months-long probe into Broadcom’s, as well as other high-tech company’s, stock-options practices.
Nicholas resigned from Broadcom 12 years after its founding in 2003 citing personal reasons. Samueli is currently the Irvine, Calif-based company’s CTO and chairman of the board.
Broadcom could not be immediately reached by Electronic News for comment this morning.
