Friday, July 28, 2006

SEC Investigates Activision Over Stock Options

Santa Monica-based Activision is reporting that it has received a letter of informal inquiry from the Securities and Exchange Commission over its stock option grant practices, making it the latest firm caught up in an ever-growing stock options backdating scandal. Activision reported in a SEC filing Friday that the SEC has requested certain documents and information related to its stock option grant practices. The firm said that its board of directors has appointed a special sub-committee of independent directors of the board to conduct an internal review, assisted by outside legal counsel, and that it would cooperate fully with the SEC. Activision joins a growing roster of Southern California companies under scrutiny by the SEC or who have announced their own internal investigations into backdating, including Quest Software, Vitesse Semiconductor, Semtech, and Broadcom. There are now more than 80 companies caught up in the stock options scandal.