Securities Law

Intent at Issue in Backdating Trial

The lawyer for the ex-CEO of Brocade Communications told jurors yesterday that his client had no criminal intent when he routinely backdated stock options grants.

About 150 people attended the opening of the San Francisco trial of Gregory Reyes, the first executive to be charged in a backdating case, the Recorder reports.

Lawyer Richard Marmaro argued in his opening statement that his client Reyes had relied on accountants to properly account for the options grants. He also said that options accounting rules were unclear and even the company’s controller did not know how to apply them.

“No one believed that the company was committing securities fraud,” he said.

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