The Commission alleged that Mercury Interactive and the former executives "perpetrated a fraudulent and deceptive scheme" from 1997 to 2005 to award themselves and other employees undisclosed, secret compensation by backdating stock-option grants, failing to record hundreds of millions of dollars of compensation expense, and falsifying documents to further this scheme.
Through Landan and at times Abrams, Smith, or Skaer, the SEC alleged, Mercury also made fraudulent disclosures concerning Mercury's "backlog" of sales revenues to manage its reported earnings, and structured fraudulent loans for option exercises by overseas employees to avoid recording expenses.
But a third official, former general counsel Susan Skaer’s case is still in talks with no agreement.
The settlement, which must be approved by the SEC, was disclosed in a court filing Thursday, but not the terms of the deal.
The charges cover stock options exercised in April, May and August 2001, prosecutors said.
In another backdating case Tuesday, federal officials charged semiconductor-maker Broadcom Corp.
On September 25, 2008, the Court granted final approval of the settlement.
The Securities & Exchange Commission and two former executives of Mercury Interactive Corp.
reach a deal to settle stock options backdating allegations that date back to actions in 1999.
Mercury's former CEO, CFO, and General Counsel actively participated in and benefited from the options backdating scheme, which came at the expense of Mercury shareholders and the investing public.
The allegations in concern backdated option grants used as unreported compensation to employees and officers of the Company.
Ca.), Labaton Sucharow is co-lead counsel representing lead plaintiffs the Steamship Trade Association/International Longshoremen's Association Pension Fund, the City of Sterling Heights General Employees Retirement System, the City of Dearborn Heights Police and Fire Retirement System, and the Charter Township of Clinton Police & Fire Pension System.