Atmel sues former execs

By Suzanne Deffree -- Electronic News, 3/26/2007

Atmel Corp. is not taking recent attacks by its former executives lightly.

Days after its former CEO George Perlegos got approval from Delaware's Court of Chancery to call a special meeting of Atmel shareholders in an effort to replace five members of the board of directors, the company Friday announced that it has filed a lawsuit against Perlegos and his brother Gust Perlegos, Atmel's former executive VP, office of the president, alleging violation of federal securities laws.

George and Gust Perlegos and two other Atmel senior executives were terminated in August 2006 by Atmel following an eight-month investigation into the misuse of corporate travel funds. At that time, George Perlegos promptly fired back, filing suit against five of the board's directors and claiming in a statement that his termination was "unlawful and improper." Last month, Delaware's Court of Chancery ruled in favor of Atmel in affirming that Perlegos and his brother were properly terminated. Furthermore, the court stated that "the Perlegoses have not demonstrated any right to hold any office of Atmel," according to a statement from the company. 

In the federal lawsuit filed Friday in the United States District Court, Northern District of California, Atmel claims that the Perlegoses are using false and misleading proxy materials in violation of Section 14(a) of the federal securities laws to wage their proxy campaign to replace Atmel's CEO and all of Atmel's independent directors with the Perlegoses' yet-to-be-named director nominees at the requested special meeting of stockholders. Atmel further claims that the Perlegos group, in violation of federal securities laws, has failed to file a Schedule 13D as required, leaving stockholders without the information about the Perlegoses and their plans that is necessary for stockholders to make an informed assessment of the Perlegoses' proposal.

"We filed this suit against George and Gust Perlegos to ensure our stockholders receive truthful and complete information about the Perlegos group's interests, plans and motivations that is required by the federal securities laws," said Steven Laub, Atmel president and CEO, in a statement. "We will continue to take appropriate steps to protect the interests of Atmel stockholders."

In the complaint, Atmel has asked the Court to require the Perlegoses to comply with their disclosure obligations, and to enjoin them from using false and misleading statements to improperly solicit proxies, as well as from voting any Atmel shares acquired during the period the Perlegoses were violating their disclosure obligations under the federal securities laws.