Friday, June 30, 2006
As if the investigation of Barry Bonds for perjury wasn't keeping the U.S. Attorney's Office in San Francisco busy enough, two more grand jury subpoenas have been issued by the Office to companies as part of the ever-widening options-timing investigation. Intuit Inc. and Equinix, Inc., both headquartered in the district, disclosed that they have received grand jury subpoenas dated June 26, 2006, and continuing a pattern seen in numerous other such disclosures, they promise to cooperate in the investigation. Intuit's press release (here) actually goes a small step further by pointing out that a number of other companies have also been subpoenaed, similar to the playground tactic of blending into the crowd when the principal suddenly appears to investigate the broken window:
On June 26, 2006, Intuit Inc. (Nasdaq: INTU) received a subpoena from the United States Attorney for the Northern District of California requesting documents related to the company’s historical stock option practices. It is our belief that similar subpoenas have been served on many of the companies named in a recent report from the Center for Financial Research and Analysis (CFRA). As disclosed on June 9, 2006, Intuit received an informal request from the Securities and Exchange Commission for information on historical stock option practices. We will fully cooperate with the U.S. Attorney’s office.
Equinix takes the straightforward approach, stating in its 8-K (here) that "it received a grand jury subpoena from the U.S. Attorney for the Northern District of California and that it intends to cooperate fully with the U.S. Attorney's Office in connection with this subpoena. The subpoena requests documents relating to Equinix's stock option grants and practices."
The issuance of subpoenas has become almost routine now, and the interesting question is if any cases will move beyond the investigatory stage and result in plea agreements that might lead to additional prosecutions. (ph)