Apple settles New York City backdating complaints

Apple today settled a class-action lawsuit with the New York City Employees’ Retirement System over claims of questionably backdated stock options. The deal will redistribute $14 million back to shareholders and $2.5 million in funding for corporate governance education at Columbia Law School and Stanford Law School. It will also include some internal reforms to prevent a repeat of the issue.

Among the changes would be stricter compliance requirements to discourage insider trading and a promise to re-examine "clawback" measures in granting executive stock compensation.

The complaints centered around a period between 2001 and 2006 that has already been subject to earlier lawsuits and settlements. Apple had been accused of backdating the day the shares were granted in such a way as to minimize its own expenses when they should have been dated later, at a higher share value. CEO Steve Jobs has frequently been drawn into complaints, but many of the improprieties have centered around former CFO Fred Anderson and former general counsel Nancy Heinen, both of whom left due largely to questionable accounting during the period.

The Employees' Retirement System should get initial approval for the new settlement on Thursday.

by MacNN Staff