"The contortions they went through in this filing to pin blame on Matt Gloss for the backdating perpetrated by others are transparent, embarrassing and ultimately quite predictable," said Miles Ehrlich, an attorney representing Gloss."Any fair-minded person who actually look at the emails and other evidence will see that this case isn't about Matt," he said.Marvell officials said they were pleased to put the SEC probe behind them. Dai are pleased this chapter is closed and are focused on moving forward,” said Marvell spokeswoman Louise Kehoe.Marvell is one of dozens of Silicon Valley companies implicated in backdating stock options, which refers to the practice of changing the date on a stock option grant backward in time, typically to when the stock price was lower, increasing the odds that the recipient could sell the stock at a profit.While the practice is not illegal, failing to disclose the change and its impact on a company’s financial statements is fraudulent.Stock options are tallied as a compensation expense to the company granting them to employees.
According to the annual report, roughly 74% of the stock options granted to employees between 20 were found to be backdated.
The lawsuit alleges that Dai, a Los Altos Hill resident, used “hindsight” to backdate options.
“Despite warning signs, Marvell failed to detect or prevent the backdating,” said Marc Fagel, the SEC’s acting regional director in San Francisco.
Neither Krueger or a representative from Marvell could not immediately be reached for comment.
The Marvell 10-K says that a retired federal judge was hired to check out Gloss' allegations about the board member's independence.