We’re hearing there might be movement on the government’s investigation of Apple’s stock options problems — at the SEC, rather than in the criminal case that everyone’s wondering about. Apple’s own investigation pinned the blame on two unnamed former execs — whom Cal Law and other media tagged as ex-GC Nancy Heinen and former CFO and board member Fred Anderson. The latest word on the government’s probe is that the SEC is preparing to file charges against Heinen, and to announce a settlement with Anderson — perhaps by the end of this month.
The reason for the former executives’ different situations, we’re told, is that while a load of options awards were incorrectly dated on Anderson’s watch, he didn’t play a direct role in the process — and didn’t engage in behavior that could easily be interpreted as showing criminal intent. So he’s facing a negligence charge, which would be settled out with a monetary agreement and no admission or denial of guilt.
Things look more difficult for Heinen. It was one of her subordinates, Wendy Howell, who prepared false meeting minutes that have been a focus of government investigators. Howell’s lawyer, Thomas Carlucci of Foley & Lardner, wouldn’t comment on his client’s situation Monday. But since Howell’s name has come out, it has been widely speculated that the government will treat her more as a witness than as a target of their probes.
Those probes, which began last fall, have progressed slowly. And while the SEC has had the same lead lawyer investigating the case for months, the U.S. attorney’s office has had rotating personnel. The lawyer initially handling it, Assistant U.S. Attorney Christopher Steskal, was joined after the investigation started by his boss, then-First Assistant U.S. Attorney Eumi Choi. But Steskal left the office for Fenwick & West, and Choi is now on a leave of absence. In recent weeks, two other assistants, Timothy Crudo and Michael Wang, have been pursuing the probe, said defense lawyers.
What that turmoil has meant is that the SEC charges are nearly ready, whereas the Justice Department’s view of the case is not yet clear. Defense lawyers said that while a settlement with Anderson would indicate that criminal charges are unlikely, Heinen’s situation is more difficult to predict.
Pestered last week and today, Crudo and Wang declined to say whether they’ll charge Heinen — or where their Apple case is at all. Local SEC enforcement chief Marc Fagel wouldn’t talk about the SEC’s plans today. One of Heinen’s lawyers, Miles Ehrlich of Ramsey & Ehrlich in Berkeley, declined to discuss his client’s situation. Jerome Roth, the Munger, Tolles & Olson partner representing Anderson, didn’t return a call seeking comment.
— Justin Scheck