Pixar’s ex-CFO could face SEC charges
The former chief financial officer of Pixar Animation Studios may face charges that she mishandled stock options, the latest fallout in the legal troubles that have plagued high-tech companies.
A lawyer for Ann Mather acknowledged that his client might become the target of a civil action brought by the Securities and Exchange Commission for alleged stock option irregularities at the Emeryville, Calif.-based creator of such blockbuster hits as “Ratatouille” and “The Incredibles.” Mather left Pixar in 2004.
“Ms. Mather acted diligently and responsibly at all times in her position as CFO at Pixar,” Mather’s attorney, Timothy J. Coleman of Dewey & LeBoeuf, said in a statement. “There is no basis for any legal action against her.” Coleman declined to comment further.
Mather declined to comment.
Mather was notified Wednesday that the SEC planned to recommend civil proceedings against her, according to a regulatory filing Monday from Google Inc., where Mather is a board member and chair of its audit committee.
Google Chief Executive Eric Schmidt issued a statement in support of Mather.
“We have the utmost confidence in Ann’s integrity as well as her abilities as a director, and we continue to support Ann’s reelection to our board of directors,” Schmidt said.
Mather also heads the audit committee at Glu Mobile, a San Mateo, Calif., mobile games company. Its president and CEO, Greg Ballard, issued a statement saying “we are confident in Ann’s integrity and capabilities and are supportive of her position on Glu’s board of directors.”
Mather is the third executive to face stock options backdating claims at the two companies associated with technology guru Steve Jobs: Pixar and Apple Inc. Jobs has been cleared of wrongdoing by internal probes at both companies. A spokesman for Cupertino, Calif.-based Apple said there were no proceedings against Jobs, the company’s CEO, “nor any reason to believe he will be named in the future.”
Walt Disney Co. acquired Pixar in May 2006 in a $7.4-billion deal that made Jobs, Pixar’s former CEO, Disney’s largest individual shareholder. A subsequent investigation by Disney’s board of directors revealed that stock option grants had been backdated before Burbank-based Disney bought Pixar, but found no misconduct by anyone “currently associated” with Disney.
A Disney spokeswoman reiterated that Monday.
“The company has learned of no facts or information that would change the committee’s conclusion or that would lead the company to believe that the SEC staff will recommend an enforcement action as to any individual currently associated with the Walt Disney Co.,” spokeswoman Zenia Mucha said.
Apple cleared Jobs in December 2006 of wrongdoing regarding the improper handling of stock options, noting that although he was “aware or recommended” the favorable dates for options awarded to other executives, he didn’t personally profit or “appreciate the accounting implications” of the practice.
SEC lawyers accused former Apple Chief Financial Officer Fred D. Anderson and former General Counsel Nancy R. Heinen of fraudulent backdating of options granted to top officers.
Anderson admitted no wrongdoing, but agreed last year to pay $3.5 million in fines and disgorgement of profits. Lawyers for Heinen have maintained that their client did nothing wrong and that she received the approval of Apple’s board for the timing of every grant in which she was involved. She goes to trial next year.
Options are rights to buy stock at a set price within a certain time period. The cost of buying that stock is generally the stock’s market price on the day the option is granted by the company’s board. Federal regulators have been investigating whether option grant dates were changed to make them coincide with a stock’s lowest price in a particular period.
A native of Britain, Mather, 47, joined Pixar in September 1999, replacing Lawrence Levy, who joined the Pixar board.
The SEC staff can recommend an enforcement action; SEC commissioners decide whether the agency will bring civil charges.
It is unclear whether the SEC is pursuing anyone else at Pixar. Michele Wein Layne, the SEC’s associate regional director in Los Angeles, declined to comment.
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