Juniper hit with $169M backdating settlement - 11 Feb 2010

(02-11) 13:03 PST --
Juniper Networks has reportedly agreed to pay $169 million to settle a
4-year-old lawsuit over backdating stock options, a practice that
entrapped and embarrassed many high-tech firms over the past decade.

Backdating
is an accounting practice in which the dates and amounts on employee
stock-options are changed to boost the value of those options. Scores
of companies ? including many big name high-tech firms ? and their top
executives were investigated and charged with criminal infractions, and
sued by their shareholders.

According to a report by the Associated Press,
the penalty is significant for Juniper in that it represents more than
half of the company's total profits from last year. It is also one of
the biggest settlements of options backdating penalties to date, the AP
states.

Managed care company UnitedHealth Group had to pay a $935 million backdating settlement in 2008. Comverse Technology and Broadcom also had to pay stiff penalties last year, to the tune of $225 million and $160 million, respectively.

A brief history of Juniper Networks

The Juniper settlement was reached this week by lawyers for the
company and a group of New York City pension funds that had invested in
Juniper. The settlement must be approved by a federal judge in San
Jose, the AP reports.