San Jose U.S. District Judge Ronald Whyte had asked for an explanation of why claims weren’t asserted against Sigma’s outside counsel in an order last month regarding a settlement of a derivative suit. The judge’s concern came after Wilson Sonsini Goodrich & Rosati paid $9.5 million to release itself from claims in Brocade’s backdating cases, where the firm also served as outside corporate counsel during the backdating era.
In court documents (.pdf) filed Friday, plaintiff lawyers from Schiffrin Barroway wrote they were “not aware of any specific documents or information that would support the assertion of claims against WSGR.”
William Almon, chairman of the Sigma audit committee, said in a declaration that he’d gotten documents from the company's former outside counsel, Wilson Sonsini, and interviewed lawyers there, but concluded the firm wasn’t at fault.
“The committee found that documentation on particular stock option grants was largely prepared internally at Sigma, and in reaching its conclusions as to the deficiencies in Sigma’s stock option grants, the committee did not find evidence of activity by its former corporate counsel that was designed to promote any alleged misconduct with respect to establishing such option grant dates at Sigma or that such former corporate counsel took action to encourage such alleged wrongdoing to occur.”
So that’s the really long way of saying, “They didn’t do it.”
— Zusha Elinson