Three shareholder lawsuits were filed against Monster Worldwide on Wednesday, all related to the backdating of stock option grants. Two of the suits were filed in New York State Supreme Court, while the third was filed in the U.S. District Court, Southern District of New York. The company says it will “vigorously defend itself” in each of the cases.
On June 12, the online job search and recruitment company received a subpoena from the U.S. Attorney for the Southern District related to its options grants. Early that day, Monster announced it was forming a committee of independent directors to conduct an internal review and analysis of all stock option grants issued previously by the company.
An update on the internal investigation was released on Tuesday. Preliminary findings suggest that Monster may need to restate its financial results for the year ended December 31, 2005 and prior years. The restatement would record additional non-cash charges for stock-based compensation expenses relating to various option grants, according to a regulatory filing.
Monster officials have not yet determined which financial statements would be restated, the magnitude of the restatement, or the tax affect of the adjustment. However, the company does not expect the potential restatement to have a material impact on 2006 earnings.
Monster is scheduled to hold a live conference call on July 26 to review the company’s quarterly financial results. Because of the ongoing independent review, and potential affect of the restatements, comparative financial results for the three- and six-month periods ended June 30, 2005 will not be provided, according to regulatory documents. Furthermore, the company’s Form 10-K filing for the period ended June 30, 2006 may be delayed.