Friday, July 11, 2008

Steve Jobs is not a crook

The WSJ and the Merc this week have reported that the SEC is not going to file criminal charges in the stock option backdating “scandal”† at Apple. Apple doesn’t seem to have acknowledged in either its PR or investor relations website pages. Obviously they don’t want anything to take away from the favorable publicity for the Jesus Phone II, which I hear is due any day now.

I guess I should not have expected a press release that said “I am not a crook.” Shareholders must be relieved that they weren’t going to see Jobs banned from being a public director, or even get the typical slap on the wrist (of a $10+ million fine) that such charges tend to bring. A civil action and a shareholder lawsuit are still pending, but somehow (unlike OJ) I imagine the result will be the same.

This happy outcome does not nullify the one particularly sordid aspect of the backdating kerfuffle†: how Jobs threw two of his most valued executives under the bus to save his own skin (and, some would argue, the company): CFO Fred Anderson and General Counsel Nancy Heinen, who also will not be charged. The strong suspicion is that even if they were personally involved, any such policy would have been approved by higher authorities.

After serving as CFO of ADP, Anderson joined Apple in 1996 as the only bright light of competence during the brief, dark Amelio era (which is why he was the only board member who got to keep his job when the iCEO came aboard). The company couldn’t buy a clue on its finances and inventory until Anderson imposed the necessary discipline.

Anderson was a holdover not a NeXTie, so it’s not surprising that there’s no love lost between the two nowadays. Last year, after he settled charges, he fired back at Jobs saying that the CEO knew more than he claimed.

Nancy-Heinen-06Meanwhile, Heinen has been very silent despite being told to take the fall. She has a long history with Jobs after becoming NeXT general counsel back in 1994, continuing at Apple until May 2006: perhaps that’s why she hasn’t said anything. But those who knew her said that she was very very competent, even more so than her high profile husband Roger who was the Apple software SVP in the 1980s before jumping ship to Microsoft. Roger was (at least until recently) a partner at Flagship Ventures in the East Bay, but I can’t find any trace of Nancy on the web.

Nancy Heinen is certainly smart enough to know the answer to the question: “Which office do I go to to get my reputation back?” She is unlikely to be hired in a senior position by a public company, and at 51 it’s too soon to retire. I don’t know if she’s going to do nonprofit work, work for a VC or other private held firm — or (as acquitted Tyco counsel Mark Belnick did) go into private practice. But I hope that she can attain personal redemption with her considerable remaining (and underutilized) talents.

Photo of Nancy Heinen from Apple Insider.

† Merriam-Webster dictionary:
  • scandal: 2: loss of or damage to reputation caused by actual or apparent violation of morality or propriety : disgrace
  • kerfuffle: see fuss. fuss: 2a) a state of agitation especially over a trivial matter

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