Tuesday, May 23, 2006

Dueling Grand Jury Investigations

The grand jury subpoenas to companies with suspiciously-timed stock option grants to their senior executives seem to be coming fast and furious, and from two different districts separated only by the East River.  The U.S. Attorney's Office for the Eastern District of New York launched the first subpoena, to Comverse Technology, and then went quiet while the Southern District of New York unleashed a set of subpoenas on May 17 to companies such as Vitesse Semiconduct and UnitedHealth.  Now comes word that additional companies have received grand jury subpoenas from one or the other district: KLA-Tencor (apparently SDNY); Brooks Automation (EDNY); F5 Networks (EDNY); Juniper Networks (EDNY) (see Wall Street Journal story here).  Are the two districts competing over the investigation of companies that have options-timing issues, or is it a matter of dividing a potentially very large field so that one office is not overwhelmed by the truckloads of documents that should be arriving shortly from each corporation that has promised full cooperation? (ph)


Fraud, Grand Jury, Investigations, Securities | Permalink

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