| FOR IMMEDIATE RELEASE December 5, 2007 WWW.USDOJ.GOV/USAO/CAN |
SAN FRANCISCO – United States Attorney Scott N. Schools announced today that Stephanie Jensen, the former Vice President for Human Resources of Brocade Communications Systems, Inc. of San Jose, California, was convicted after trial of one count of conspiracy and one count of falsifying books and records relating to her scheme to backdate options grants to Brocade employees.
The guilty verdicts followed a two (2) week jury trial before U.S. District Court Judge Charles R. Breyer. This conviction is the result of an investigation by the Federal Bureau of Investigation and the United States Securities and Exchange Commission.
Evidence at trial showed that Ms. Jensen, 50, of Los Altos, California, schemed to price option grants to Brocade employees by using historical stock performance data to pick low prices while backdating the grant minutes to hide when the options were actually granted. By this scheme, Ms. Jensen enabled Brocade to improperly avoid recognizing compensation expenses that would have reduced the company’s reported net income.
Scott Schools commented: “The jury’s verdict re-emphasizes that backdating option grants, when it is done with an intent to deceive, is a crime. The integrity of our stock markets depends on the accuracy of the books and records of a public company. Accordingly, prosecuting securities fraud and manipulation will remain one of this office’s top priorities.”
Ms. Jensen is scheduled to be sentenced before Judge Breyer on March 12, 2008. The maximum statutory penalty for each count is a term of imprisonment of up to twenty (20) years and a maximum fine of $5,000,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Timothy P. Crudo and Adam A. Reeves are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Paralegal Lilian Arauz.
Further Information:
Case No. CR- 06-00556 CRB
A copy of this press release may be found on the U.S. Attorney’s Office’s website at www.usdoj.gov/usao/can.
Electronic court filings and further procedural and docket information are available at https://ecf.cand.uscourts.gov/cgi-bin/login.pl.
Judges’ calendars with schedules for upcoming court hearings can be viewed on the court’s website at www.cand.uscourts.gov.
All press inquiries to the U.S. Attorney’s Office should be directed to Joshua Eaton at (415) 436-6958 or by email at Josh.Eaton@usdoj.gov.