Brocade Ex-CEO Gets 21 Months in Backdating Case
The former chief executive of Brocade Communications Systems was sentenced to 21 months in prison for orchestrating a scheme to tamper with the company's records of stock option grants.
Gregory Reyes, Brocade's CEO from 1998 to 2005, was also ordered to pay a $15 million fine.
At the sentencing hearing, U.S. District Judge Charles Breyer said Reyes obstructed justice in preparing for trial.
Reyes broke down crying while speaking to the judge before his sentence was handed down.
Reyes was the first executive to be tried over stock options backdating when his case went before a federal jury in San Francisco in June 2007. He was convicted in August of 10 counts of securities fraud.
The case has been seen as an important test of how seriously infractions of options-related securities laws will be punished.
Shares of Brocade Communications were marginally lower Wednesday.