OPEN COURTS -- Henry Samueli, the co-founder of Broadcom Corp., is fighting to keep
the public out of a pending hearing before the 9th U.S. Circuit Court
of Appeals in which he is seeking to reinstate a plea deal that he
reached last year with prosecutors, reports Amanda Bronstad for the National Law Journal.
Under the proposed plea in the U.S. government's criminal case
involving alleged stock options backdating at Broadcom, Samueli would
have admitted making a false statement to the U.S. Securities and
Exchange Commission regarding his role in the backdated stock options,
which forced Broadcom to restate more than $2.2 billion in earnings in
2007. He would have served five years on probation and paid a $250,000
fine, plus $12 million to the U.S. Treasury.
On Sept. 8, 2008, U.S. District Judge Cormac Carney of the Central District of California rejected that deal
on the ground that it would "erode the public's trust in the
fundamental fairness of our justice system" and give the perception
that "justice is for sale."
The judge identified Samueli as an unindicted co-conspirator -- referred to as "H.S." -- in an indictment that federal prosecutors brought earlier in 2008
against Broadcom's other co-founder and former chief executive, Henry
Nicholas, and its former chief financial officer, William Ruehle, both
of whom face life sentences if convicted on all counts.
"The Government has publicly levied very serious allegations of
securities fraud against Dr. Samueli that, if true, warrant a
significant prison sentence," Carney wrote at the time. "If there is
any truth to these allegations, a probationary sentence does not
adequately reflect or account for the seriousness of the underlying
misconduct alleged against Mr. Samueli." He noted that a presentence
report recommended that Samueli serve a year in prison.
Briefs filed by Samueli and federal prosecutors appealing the
judge's decision have been sealed. Oral argument on the appeal is
scheduled for Sept. 2 at the 9th Circuit's courthouse in Pasadena,