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Ex-Mercury Interactive GC to Pay $850,000 to Settle Backdating Charges
Former Mercury Interactive Corp. general counsel Susan Skaer is set to pay $850,000 to settle civil charges that she participated in the improper backdating of stock options..
If approved, the settlement will close a six-year-old case against Skaer, one of the first Silicon Valley in-house counsel caught up in the backdating scandal. In May 2007 the Securities and Exchange Commission filed a complaint against Skaer and three other senior executives at Mercury alleging they had orchestrated 45 option grants between 1997 and 2002 and hid associated compensation expenses of $258 million. Skaer was the last defendant to settle. She had been scheduled to go to trial before U.S. District Judge William Alsup in San Francisco this past Monday.
"We're happy to have this behind us," said Skaer's attorney, James Kramer of Orrick, Herrington & Sutcliffe.
Skaer and other top Mercury executives left the company in 2005 after an internal investigation that concluded they "knew, or should have known, that the [option grant] practices were contrary to the options plan and proper accounting."
Without admitting to the SEC's allegations, Skaer will pay disgorgement and pre-judgment interest totaling $628,037 plus a civil penalty of $225,000. The deal's terms, outlined in papers filed Friday by SEC attorneys, were not as harsh as those included in settlements between the commission and some of Skaer's former colleagues. To settle his case with federal regulators last month, former Mercury chairman and CEO Amnon Landan agreed to pay $1.2 million in disgorgement and interest and a $1 million civil penalty. He will also reimburse Hewlett-Packard Co., the company that acquired Mercury in 2006, $5 million for cash bonuses and the sale of stock he received in 2003.
Skaer is now a licensed real estate broker working in Palo Alto under the name Susan Tanner, according to the state Department of Real Estate.
This article originally appeared in The Recorder.