Securities Law

Brocade Lawyer Protests Surprise Statement

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A federal judge in San Francisco will hold a hearing today on whether to admit evidence showing the former CEO of Brocade Communications knew backdating stock options was illegal.

The evidence would be a blow to the defense of ex-CEO Gregory Reyes, the Recorder reports. In opening statements on Monday, lawyers for Gregory Reyes had argued their client didn’t know backdating was prohibited.

Prosecutors waited until yesterday to reveal they have a witness who will say Reyes told her, “It’s not illegal if you don’t get caught.”

Defense lawyer Richard Marmaro protested that the statement by former employee June Weaver should have been released to the defense earlier.

Assistant U.S. Attorney Adam Reeves maintains he didn’t reveal the statement because only information from FBI interviews need be turned over in advance—and the statement was not mentioned in the FBI interview.

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