Wednesday, July 19, 2006

Options-Timing Probes = Law Firm Marketing Opportunity

A Wall Street Journal article (here and Law Blog entry here with access to the article) discusses the response of major law firms to the current spate of SEC and grand jury investigations of companies related to the timing of their options awards.  Not surprisingly, the firms have viewed this as a marketing opportunity, informing current and potential clients that the best strategy is, of course, to consult with competent counsel.  For example, national law firm Latham & Watkins is touting its "Options Timing Working Group" that comes complete with a page on the firm's website (here) and offers missives written by Jim Barrall in The Executive Comp Insider that tout, again not surprisingly, the need to obtain legal counsel.  The burgeoning investigations have already touched over fifty companies, and that's just the ones publicly disclosing pending investigations.  The number of companies conducting their own internal reviews is much higher than that, and we will see more disclosures of problems in the coming months.  With all the lawyers getting involved in these cases, the interesting question will be whether firms are conflicted out of certain representations, either because they were involved in the drafting of the stock option agreements or their conduct of an internal investigation means they cannot defend individual officers or directors in subsequent cases.  As Peter Lattman notes in the WSJ article, this is another instances of lawyer full employment -- not that there's anything wrong with that. (ph)

Defense Counsel, Grand Jury, Investigations, Securities | Permalink

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