IRVINE, Calif. — Broadcom Corporation (Nasdaq: BRCM) today announced that the remaining defendants in the federal consolidated shareholder derivative action relating to the company's historical stock option accounting practices have entered into a settlement. Federal shareholder derivative actions were filed in 2006 by certain named shareholder plaintiffs against each of the then members of Broadcom's Board of Directors and certain current and former officers. The actions, which were later consolidated, sought recovery for the company's benefit.
As previously disclosed, in August 2009 Broadcom, through its Special Litigation Committee, plaintiffs and certain of the defendants entered into a partial settlement in the federal derivative action. The partial settlement resolved all claims in the action, other than those against three individuals: Dr. Henry T. Nicholas, III, Broadcom's former President and Chief Executive Officer and former Co-Chairman of the Board, William J. Ruehle, Broadcom's former Chief Financial Officer, and Dr. Henry Samueli, Broadcom's Chief Technical Officer and current nominee to the Board. The preliminary settlement announced today will resolve those remaining claims.
The settlement is subject to approval by the United States District Court for the Central District of California. If the settlement is given final approval by the Court, among other things:
“We are pleased to report that this long-running litigation is drawing to a close,” said Scott McGregor, Broadcom's Chief Executive Officer. “At the same time we are gratified that we can devote a portion of this one-time gain to the Broadcom Foundation to further support STEM education programs and a range of community services.”
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