Former KB Home CEO Bruce Karatz could not have relied on advice about stock-options backdating from the company's general counsel because he lied during an internal investigation into the practices, federal prosecutors argued in attempting to quash Karatz's motion for a new trial. "Rather than establishing defendant's good faith reliance on an attorney, the record readily establishes that defendant used [General Counsel Ben Hirst] to perpetrate a fraud," prosecutors wrote in papers filed this week.
Prosecutors Say Lies Undermine KB Home Chief's Advice-of-Counsel Defense
The National Law Journal
July 22, 2010