About | ACP | Buy | Industry Watch | Learning Curve | News | Products | Search | Substack
Home » Industry Watch

Deposition Disposition

What's a poor soul to believe? Anything at all?

Get It

Try It

Forbes recently got their hands on the Steve Jobs deposition with the SEC in Cupertino last March. According to their version it took some time and some struggle using the US Freedom of Information Act. But they got it.

The deposition which took just over three hours was recorded on video but that's not been released. A redacted transcript has. This transcript is available as a PDF from the Forbes website. See below for the direct URL.

What's being claimed here by the SEC is that before the 18 December 2001 action of the Apple board minutes of a 29 August 2001 meeting were doctored to claim the board had not yet approved any stock options - and then minutes to a meeting on 19 October 2001 that never took place were created out of thin air.

The main benefactor this nefarious act - if indeed it took place - is Steven Paul Jobs. As the Forbes article points out, backdating options is not illegal but failing to disclose one's actions can be.

Both Nancy Heinen and Fred Anderson were accused by the SEC of being complicit in an action to doctor board meeting records and even create a record of a meeting that never took place - all to give Jobs a better price.

Other staff may have benefited as well but not on the order of the estimated $20 million Jobs benefited. Jobs points out repeatedly in his deposition that the dating of options is a triviality and not a great concern as options only get good if the stock price goes up considerably. And yet $20 million is after all a lot of money.

At the core of the issue is an exchange of 20 million 'underwater' (impossibly priced) stock options Jobs acquired before the dot-com bust (which he consequently never capitalised on) for 7.5 million 'new good' options to be granted in 2001 instead.

Anderson settled without admitting anything and paid $3.3 million in damages. Heinen settled too - for $2.2 million - but repeatedly denied being involved. No charges have ever been brought up against Jobs.

Reactions to the Forbes article have been widely disparate. Punters on the one side accuse the SEC of intentionally letting Jobs off the hook. Punters on the other side say Jobs is the best CEO for any company ever and even in his sleep can do no wrong.

The truth is likely somewhere between those antipodes.

There are two comments to the Forbes article online. The first is by 'wrbeeler'.

I think this is all blown out of context. There might have been some inpropriety but I do not believe Steve Jobs was a Recepient.

The word 'recepient' [sic] is unfortunate. Jobs was the recipient. The word 'co-conspirator' would have worked better.

The second comment to the article is by 'AppleVictim'.

The Apple Stock options Scam was made public when Apple suddenly announced in 2006 that it was 'voluntarily investigating itself'. Why would a corporation publicly announce that it has commited fraud? Because I filed a lawsuit against them after they had stolen thousands of my stock options given to me for outstanding performance at Apple for the relase of their flagship Mac OS X. This was part of a retaliation where I was 'layed off' from the company right after September 11 and todl to leave the country (I am a minority).

Apple realized that I was going public with the options theft through my lawsuit (and that dozens of other employees had unknowingly had their options stolen/redated as well). Immediately after the 'voluntary self investigation', Apple claimed that Steve Jobs had nothing to do with the scam.

These are all lies and attempts at covering up fraud. Steve Jobs' disapearance from public view for 'medical reasons' for the last year is also a scam.

Apple has so far paid out $14 million to share holders over this (paid for by insurers), but the victims like myself have not receieved a penny because of the crooked Palo Alto Superior Court which claims in its records that I 'dismissed' my case against Steve Jobs and ignored the fact that Jobs had illegally sent Apple lawyers and staff to the court in spite of the fact that the lawsuit was against HIM PERSONALLY AND HE HAD BEEN SERVED.

Steve Jobs is hiding from getting served again with lawsuits over the options scam and all of this is under the guise of his 'illness'.

Of course the above revelation does not explain how 'AppleVictim' gained access to proprietary Apple board documents - how 'AppleVictim' could have known anything about the correspondence between Jobs, Heinen, Anderson, and the rest of the board of directors of Apple. It's a somewhat plausible story but it lacks one thing: 'means'.

Open Questions, Strange Contexts

The Forbes disclosures give rise to a number of questions without really attempting to answer many of them.

  • Why should anyone care? Possible answers: to exonerate (or incriminate) Steve Jobs, Nancy Heinen, and Fred Anderson; to simply want to get to the bottom of the matter. But why should any of this affect anyone now?
  • Why would billionaire Steve Jobs worry about $20 million? Possible answer: it was never about the money - it was about prestige. He wanted recognition from the board and in his own words felt 'hurt' because he didn't get it. Perhaps getting a bad date on his options felt like another slight. But see below.
  • Why try to hide it? Backdating options is legal. Why make such a big thing out of it and try to hide it? Who would stand to gain by such a move? Remember: anyone who gained by the backdating would also gain if it had been done openly.
  • Who blew the whistle in the first place? And how and why? Presuming the story by 'AppleVictim' is merely a troll. 'AppleVictim' provides motive alright - it's just the 'means' that are lacking. No one's officially ever explained why Apple began their own internal audit or who suggested such a thing. And where that information came from. And why.

At the end of the day there are too many open questions and actors and events that seem totally out of context.

One of the most obvious is why Nancy Heinen (and indirectly Fred Anderson) would jeopardise an impeccable 20 year record alongside Steve Jobs at NeXT and Apple to engineer a bogus board record to backdate stock options for no given reason, to do so only for Jobs' benefit, without informing Jobs of their actions, without Jobs knowing of their actions, without Jobs interfering with their actions - and all without Apple's board of directors ever noticing they had minutes on record to a meeting of theirs that never took place.

See Also
Forbes: Steve Jobs Under Oath
Forbes: Steve Jobs: Nobody Loves Me
Forbes: Steve Jobs Deposition 18 March 2008

About | ACP | Buy | Industry Watch | Learning Curve | News | Products | Search | Substack
Copyright © Rixstep. All rights reserved.