Apple Inc. and several of its officers and directors, including two CFOs, agreed to settle their stock-options backdating case for $14 million, The National Law Journal reported.
In a deal that won a federal judge’s preliminary approval on Monday, Apple also agreed to pay $7.3 million in attorney fees and $300,000 in other expenses to plaintiffs in civil federal actions, and $1.2 million in attorney fees and $50,000 in expenses to plaintiffs in civil state cases, according to the report.
The Law Journal also noted that Apple agreed to certain corporate governance changes.
The settlement ends 14 derivative federal actions and five state derivative suits brought against Apple.
The defendants included Apple; chief executive Steve Jobs; former CFO Fred Anderson; CFO Peter Oppenheimer; chief operating officer Timothy Cook; former general counsel Nancy Heinen; senior vice president Ronald Johnson; former senior vice presidents Mitchell Mandich, Jonathan Rubinstein, and Avadis Tevanian Jr.; and board members William Campbell, Millard Drexler, Arthur Levinson, and Jerome York.
In court papers, Apple reportedly said that “most of the grants cited in the federal complaint could not give rise to recoverable damages because they were not misdated or the grants were cancelled before they were exercised, thereby providing no benefit for the grant recipient and imposing no loss on the company. Proceeding with the litigation, however, will impose extensive and unrecoverable costs in the form of attorneys’ fees and expenses.”
Last month, Heinen agreed to pay $2.2 million to settle Securities and Exchange Commission stock-option backdating charges. And Anderson, in April 2007, agreed to pay more than $3.6 million to settle SEC charges.
The commission said last April that it would not bring any enforcement action against Apple itself, citing the company’s “swift, extensive, and extraordinary cooperation” that included prompt self-reporting, an independent internal investigation, the sharing of the results of that investigation with the government, and the implementation of new controls designed to prevent the recurrence of fraudulent conduct.
