Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Wednesday, October 19, 2011

SEC & Former Inhouse Counsel Settle Backdating Charges

If you remember the backdating stock options scandal of a few years back, you may recall that the SEC brought a number of enforcement actions against inhouse counsel.  Today the SEC announced the conclusion of one of these matters and the settlement of its claims against Lisa C. Berry, the former General Counsel of KLA-Tencor Corp. and Juniper Networks, Inc. The Commission alleged that from 1997 through 2003 Berry caused KLA-Tencor and Juniper to report false financial information to the investing public through her preparation of corporate records that concealed that employee stock option grants were priced with the benefit of hindsight at both companies.  Without admitting or denying the Commission's allegations, Berry consented to pay a $350,000 civil penalty, and also to pay disgorgement totaling $77,120, including interest. The United States District Court for the Northern District of California approved the settlement on October 7, 2011.

In a separate administrative proceeding, Berry also agreed to be suspended from appearing or practicing as an attorney before the Commission. Under the terms of the agreement, Berry may apply for reinstatement in five years. Berry agreed to the suspension without admitting or denying the Commission's allegations.

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