"Reuters" reports that Comverse Technology Inc. (Pink Sheets: CMVT.PK) has filed a lawsuit for more than $70 million against its founder and former CEO Kobi Alexander and former legal counsel William Sorin, over their alleged role in options backdating offences.
"Reuters" says the company is suing the two men for fraud, breach of fiduciary duty, and other claims, alleging they schemed to backdate millions of stock options granted to employees and advisers.
Alexander fled the US after the revelations about the backdating first came to light, and eventually resurfaced in Namibia, where he has managed to repeatedly evade extradition. Sorin was sentenced to 13 months in prison under a plea bargain, following which he will be under probation for three years.
Aside from the sentencing of Sorin and the legal proceedings against Alexander, until yesterday none of the other company CEOs accused of options backdating had been sent to prison. Yesterday a new precedent was set when former Brocade Communications Systems Inc. (Nasdaq: BRCD) CEO Gregory Reyes was sentenced yesterday by a court in San Francisco to 21 months in prison and fined $15 million.
Published by Globes [online], Israel business news - www.globes.co.il - on January 17, 2008
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