Privacy

McAfee settles lawsuit for $14 million

December 27, 2007
McAfee, in a filing with the federal Securities and Exchange Commission, has restated a decade of earnings after the company revealed last year that an internal investigation turned up stock option improprieties.

McAfee revealed that it will take on $137.4 million in additional charges from between 1995 and 2005, according to a statement released Friday.

In addition, the company announced it has budgeted $13.8 million to cover the settlement of lawsuits filed in 2006 related to the backdating scandal – a term used when executives alter the grant date of stock options so that they can be purchased at a lower price and subsequently sold for higher gain.

McAfee announced in July 2006 that it was suspending its stock options in light of a federally spurred internal investigation into backdating practices. At least seven employees sued the security giant in December of that year after they were unable to cash in their stock options upon leaving the company.

Around the same time, McAfee fired its president, and its chief executive officer resigned amid the fallout.

McAfee said Friday it plans to launch a share repurchase program, meaning the company would buy back a number of outstanding shares, thus boosting the value of remaining shares.

In March of this year, the board of directors named Dave DeWalt as McAfee's new president and CEO.

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