Risk & Compliance

Microtune’s Tune Is a Consent Decree

In its stock-option backdating case, the company comes to terms with the SEC .
Stephen TaubJuly 1, 2008

Microtune Inc. agreed to settle Securities and Exchange Commission charges stemming from an investigation into the company’s historical stock option granting practices.

Under the deal, the designer and marketer of radio-frequency products for the broadband communications and transportation electronics markets did not admit to or deny the allegations in the SEC’s complaint. It consented to entry of a permanent injunction against future violations of the federal securities laws. Microtune said it was not required to pay a civil penalty or other money damages as part of the settlement.

“Microtune self-initiated an audit committee investigation into these matters, reported its findings to the SEC, and cooperated fully with the SEC as it conducted its own investigation. We are extremely pleased to resolve this matter with the SEC,” said James A. Fontaine, pPresident and CEO.

In addition, Microtune said the U.S. District Court for the Eastern District of Texas dismissed a derivative lawsuit against the company and certain current and former officers and directors. The suit alleged various claims related to Microtune’s historical stock option granting practices.

The company, which has a $187 million market cap, noted that prior to the dismissal of the litigation, on May 21, one of the plaintiffs made a demand on the board that the company take certain actions related to its historical stock option granting practices. Directors are evaluating this demand, the company added.