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Eight former top-level executives of Long Island, N.Y.-based Symbol Technologies Thursday were charged with fraud in a 25-count indictment. The indictments were sought by Roslynn Mauskopf, the U.S. Attorney for the Eastern District of New York; the Securities and Exchange Commission; and other government investigators. Included among the top officers was Leonard Goldner, the company’s former general counsel and executive vice president. His co-defendants include the former chief executive and other senior officers. The bulk of the government’s case involves charges of securities and accounting fraud. Goldner was charged with nine counts of mail and wire fraud and tax-related charges for his alleged role in manipulating implementation of Symbol’s stock option plan to evade tax payments and profit at the company’s expense, according to government documents. Based in Holtsville, N.Y., Symbol is a leader in developing and manufacturing wireless and mobile computing and bar code reading devices. Its revenues last year exceeded $1.5 billion, and it employs more than 5,000 employees in 92 offices worldwide. The government began its inquiry after receiving an anonymous tip in 2001, Mauskopf said. She said five other former executives already have pleaded guilty to accounting fraud and that the investigation will continue. Prosecutors claim Symbol’s executives manipulated financial statements through a variety of accounting schemes to meet Wall Street earnings expectations. The overall impact of these schemes, said the government, led to a $530 million overstatement on pre-tax earnings from 1998 to 2003. Symbol, represented by Andrew Levander of Swidler Berlin Shereff Friedman, settled a separate civil suit with the government Thursday for $139 million, according to government documents. Levander also represents Michael Rigas in the ongoing corporate fraud trial involving cable giant Adelphia. The cash and stock settlement with Symbol, announced Thursday by plaintiffs’ lawyers, will be paid to injured investors suing the company in class action suits. Symbol’s agreement with the government includes measures to reform the company’s internal accounting methods, and the government will designate a corporate monitor to oversee financial reporting, said Mauskopf. The indictment against Goldner centers on his role in implementing a stock option plan for company executives and on his own behalf. Prosecutors said Goldner falsified dates on documents showing when the options were exercised, using dates that reduced the apparent amount of taxes owed from the transaction. A person exercising an option must pay taxes on the difference between the option price and price on the date the options are exercised. Goldner, who was responsible for authorizing the exercise of options by executives, allowed the officers to select exercise dates on which Symbol’s stock was lower than the ones on which the options were exercised. The scheme, said prosecutors, amounted to tax evasion and defrauded Symbol of tax deductions it could have earned had Goldner used the proper exercise date. For 2002, the evasion led to a $150,000 reduction in reported income by Goldner personally, said the indictment. Besides potential fines and imprisonment, government prosecutors are seeking the forfeiture of millions in assets from Goldner, including 153,000 shares, options and warrants in Symbol’s stock. Symbol’s shares closed at $15.43 Thursday, up 72 cents. Goldner’s defense lawyer, Andrew Geist of O’Melveny & Myers, the former senior associate regional director of enforcement at the SEC, could not be reached for comment. Goldner was not indicted for securities fraud despite his role as general counsel. George Stepaniuk, assistant regional director of the northeast region of the SEC, said his agency did charge Goldner with civil securities fraud. Goldner, a cum laude graduate of Harvard Law School and resident of Huntington, N.Y., became Symbol’s general counsel in September 1990. He had assisted Symbol on corporate and securities matters for nearly a decade while he was a partner at New York’s Shereff, Friedman, Hoffman and Goodman. His former firm merged with Washington, D.C.’s Swidler & Berlin in 1998. As Symbol’s general counsel, Goldner led the company through a myriad of patent litigation culminating with its battle regarding Jerome Lemelson’s patents used in bar code technology. The multiyear litigation ended in a spectacular victory for Symbol in January but cost the company at least $10 million in legal fees, according to news reports. In 2000, Goldner was the ninth-highest paid general counsel in the nation, with total pay reaching nearly $10 million, according to a survey conducted by Corporate Counsel Magazine, an affiliate of the New York Law Journal. In February 2001, Symbol’s board of directors promoted Goldner from senior vice president to executive vice president, according to a company statement.

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