Legal News

Updating Backdating: Feds Strike Pact With Monster Founder

By Peter Lattman

All anyone around here can talk about this morning are the tragic death of Heath Ledger and the new word on tuna sushi. (So much for our twice-weekly spicy tuna rolls!) But can we please just for a second refocus the conversation on the law? There are important stories out there, like the resolutions to last year’s stock-options backdating scandals.

Monster Worldwide’s founder Andrew McKelvey has reached a deferred prosecution agreement with the feds to settle a long investigation into his alleged role in a backdating scheme at the company. Under the agreement with federal prosecutors in Manhattan, McKelvey will acknowledge wrongdoing, but won’t be forced to enter a guilty plea and won’t face jail time.

McKelvey, the company’s former CEO, is also expected to reach a settlement with the SEC in which he will disgorge around $250,000, according to the person familiar with the matter. He’ll also pay back millions of dollars to the company, which was prepared to pursue various legal claims against him, the WSJ reports. The company is represented by Andrew Levander at Dechert.

The WSJ reports that the deal’s leniency reflects McKelvey’s poor health. He has pancreatic cancer and his prognosis is poor; it is unclear whether he would be alive to face trial. McKelvey is represented by Steven Reich at Manatt Phelps.

Monster’s former GC Myron Olesnyckyj, represented by Leslie Caldwell at Morgan Lewis, pleaded guilty last year to criminal charges and cooperated against McKelvey and other executives at Monster, a company perhaps best known for its Super Bowl ads. Did someone say Super Bowl? Let’s get the Law Blog tailgate started. Go Big Blue!!!!!!

Full post as published by Law Blog - WSJ.com on January 23, 2008 (boomark / email).