Legal News

SEC Accuses Former Pixar CFO of Backdating

By Dan Slater

Academy Award-winning Pixar Studios — creator of such fun-loving CGI-animated films as “Finding Nemo” and “Ratatouille” — has become the most recent company to be caught up in the backdating scandal. The SEC’s Los Angeles office says it plans to recommend that the agency take civil action against Pixar’s former CFO, Ann Mather, who worked at the company from 1999 to 2004. The accusation: that Mather approved the improper dating of stock-option grants. Here’s Nick Wingfield’s WSJ report.

According to the report, the SEC is alleging violations of federal securities laws relating to options transactions that occurred while Pixar was an independent company. (Now it’s owned by Disney Co.) The agency’s action was disclosed yesterday in a regulatory filing by Google, where Mather serves on the board.

Mather’s attorney, Dewey & LeBoeuf’s Timothy Coleman, said, “There is no basis for any legal action against her.”

In 2006, Disney said the SEC was looking into Pixar options granting. But last year Disney reportedly closed its own inquiry, concluding that backdating had occurred prior to its acquisition of the company and that no one currently associated with Disney had engaged in intentional misconduct. Those findings appeared to exonerate Steve Jobs, the former CEO of Pixar and now a Disney board member as well as CEO of Apple.

A source told the WSJ that Pixar’s options-granting practices were in place before Mather joined, and that Pixar’s board, its auditors and its outside legal counsel at Wilson Sonsini were aware of the practices. “We have the utmost confidence in Ann’s integrity, as well as her abilities as a director, and we continue to support Ann’s re-election to our board of directors,” wrote Eric Schmidt, Google’s CEO, in a release.

Full post as published by Law Blog - WSJ.com on April 29, 2008 (boomark / email).