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Broadcom co-founder Samueli leaves guilty plea in place

October 14, 2008

If you’ve been following the unraveling of Henry Samueli, here’s the latest: The Broadcom co-founder and ex-CTO has decided not to withdraw his guilty plea and appeal, even though it means he could face a harsher sentence than the agreement with prosecutors.

US District Judge Cormac J Carney in September rejected a plea deal that would have seen Samueli stay out of jail and pay a $12 million fine. Carney did so because in his opinion the excessive fine would have been viewed by the public as Samueli buying his freedom.

Samueli’s options then were to withdraw the guilty plea and go to trial, to appeal the Carney’s ruling, or to work with prosecutors on an alternative plea settlement.

Leaving the plea in place and appealing, Samueli is betting that he can still avoid prison time, the max for this crime being five years. 

Samueli’s mess started when he lied to the Securities and Exchange Commission about stock-option backdating at Broadcom. Busted in June, he then made the plea under a deal with federal prosecutors.

This blog’s readers seem to be divided as to whether Samueli should be forced to trade his pinstripe suit for an orange jumpsuit. Some readers, like "Rita," believe Carney was right to turn down the deal.

She posted a comment on September 10 at 2:14:32pm to this series previous "Broadcom’s Samueli on thin ice" post stating: "The judge got it right. The magnitude of the offense and the obstruction deserves some jail time, probation and community service. If it were as lesser amount of money for a ‘regular joe,’ he would already be in jail."

But there are many, many readers who have defended Samueli in this blog, calling him "sincere" and pointing out his contributions to the tech community, as well as his local community. Like a reader identified as "Craig" who commented on September 13 at 10:35:19pm: "Jail???? Are you kidding me!!! This is guy has done more positive actions for his country and community than 99.9% of Americans!!!!"

The appeal of Carney’s rejection likely will not be completed until next March. And it seems that Carney wants to hold off on Samueli’s sentencing until after his Broadcom co-founder Henry Nicholas goes to trial. Nicholas pleaded not guilty to the stock-option backdating charges and separately pleaded not guilty to allegations of drug use and distribution. Nicholas’s trial is scheduled for April, but it could be delayed. Right now, Samueli’s sentencing is scheduled for August.

What do you think? Samueli’s taking a big risk holding the guilty plea. Will the appeal work in his favor? Share your thoughts below.

Posted by Suzanne Deffree on October 14, 2008 | Comments (8)

May 28, 2009
In response to: Broadcom co-founder Samueli leaves guilty plea in place
student commented:

samueli was my prof at ucla. he is sharp as a tack; focused and was/is interested in teaching technology. putting him in jail is a waste of money and his time. let him pay $20M; calif could use the money and he could do better things for human kind than sit in a jail. leave jail for violent criminals...dont wast the court time...


October 20, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
dcltr commented:

Samueli should have fought. Backdating was a universal practice approved by everyone in the industry. Samueli's charge is simply that he responded positively to one email, and then later said he was not in charge of the decisionmaking. More to the point, the crime is level 4, punishible by 0-6 months, and almost always by probation. Carney is a notorious hanging judge, new to the Fed bench, trying to score points. His loose talk of 17 month sentences reflects the kind of thing the Miller case has brought in; judges wildly oversentencing. He should have gone to trial. This comes from the Bush Justice Dept. In a few months it could all be different.


October 17, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
Also Former BRCM commented:

Henry is a sincere, good, decent individual who got caught up in Nick''s BS (as we all did at one time or another). Henry should absolutely NOT go to jail. Nick however deserves everything he gets.... PS: The drug charges are totally valid!


October 17, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
lasttime commented:

I think samueli may be a great guy, never met him. But last time I checked, "goin along for the ride" is called an accessory and gets you in trouble. Samueli worked with nick far long enough to know the score. He may not have perpetrated the acts, but he knew. Check the original judge;s rejection. There is ample evidence samueli "signed off" on the back dating. It was illegal. He deserves to be punished, otherwise where is justice?


October 17, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
thorOM commented:

Professor Samueli, If you are reading this. You have much more for the US engineering community than a lot of undereducated corrupt VPs that I have seen in 20 years. I hope whatever happens you can come back to academia to teach. Now that VLSI industry is in trouble they just want to hang certain people. Without your DDS they would not be getting their broadband wireless at this low cost. So goes for your contribution to DSL design.


October 16, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
JimOM commented:

I agree with FormerBRCM. I knew Samueli when he was at an aerospace company. He was an engineer and college professor. I don't think he wanted to be a billionare, but he happened to meet Nicholas, who had boundless ambition, and he went along for the ride. Look at what it got him. But, again you can see that Samueli is taking the high road rather than switching pleas and refusing to work with prosecutors. Hopefully the judge will take that into account.


October 14, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
Former BRCM commented:

Samueli IS a great guy. I won't comment on Nick at all, but I steadfastly refuse to believe that Henry took part in any shenanigans. I never heard one single peep about Henry participating in anything but engineering reviews, ever. He was up to my time there always a humble and unassuming person, always interested in the well being of the engineering staff. He's an innocent geek. This is not a CEO from Wall Street who ripped off people. This is a CTO who developed the chips for most of those cable and DSL modems you all are reading this message with. 'nuff said.


October 14, 2008
In response to: Broadcom co-founder Samueli leaves guilty plea in place
Amy Stoody commented:

I think what makes it so difficult to accept Samueli doing time for this crime is that he did not directly profit from it, although it can be argued that he and Broadcom derived a benefit from attracting better prospects with the stock-option offer). His contributions and standing in the community also lead many to say "what a shame." Unlike Nicholas, his alleged "partner in crime," Samueli seems like a great guy; therefore, it would appear that taking a chance on an appeal could operate in his favor, especially since he knows Carney's position.

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