Posted by: Dave Raffo
Former Brocade CEO Greg Reyes received a 21-month sentence and $15 million fine for his role in backdating options given employees of the SAN switch vendor.
Reyes won’t do jail time yet. U. S. District Judge Charles Breyer let Reyes go free pending an appeal. And it could’ve been worse; prosecutors had recommended that Breyer sentence Reyes to at least 30 months, fine him $41 million and ask him to repay Brocade for legal fees after his conviction last August.
Breyer said he was swayed by nearly 400 letters of support he received on Reyes’ behalf and took that into consideration when he sentenced the disgraced CEO.
And no, those letters didn’t all come from other CEOs whose companies have been investigated for improperly reporting backdated options. Breyer did at least make it clear why Reyes is facing jail time despite claims from his supporters who say he should not have been convicted because he did not personally benefit financially and there was no victim in this crime.
“This offense is about honesty,” Breyer said in handing down his sentence, reminding all that it’s not all right when a CEO breaks the law to recruit talent or place his company in a better light.
For his part, Reyes apologized, said he regretted his actions and admitted “there were many things I would have done differently” if he could turn back the clock. That didn’t sound like someone who pleaded not guilty and sought a new trial after claiming a witness changed her story, as Reyes did.