Former Gemstar CEO to Plead Guilty
Former Gemstar-TV Guide International Inc. CEO Henry Yuen will plead guilty to a felony charge of obstruction of justice Oct. 3, his attorney confirmed Wednesday.
Yuen, who was ousted by Gemstar in 2002, was accused of cooking the books at the company and allegedly attempted to erase files from his Gemstar computer to thwart Securities and Exchange Commission investigators.
Under the plea deal, Yuen will be sentenced to six months of home confinement and two years of probation.
“Henry Yuen is grateful that it is all now behind him, and he looks forward to his future in media. What Dr. Yuen will be pleading guilty to was the product of bad judgment that in no way affected Gemstar or its shareholders,” his attorney, Stanley Arkin, said in a prepared statement.
The SEC had alleged that Yuen and other Gemstar executives overstated revenue by at least $248 million from 1999-2002, partly through booking interactive-program-guide ad revenue through disputed or nonexistent deals and round-trip transactions.
Under Yuen’s leadership, Gemstar had booked $107.6 million in fictitious revenue from Scientific-Atlanta Inc. -- money Yuen hoped Gemstar would eventually collect through patent litigation with S-A.
In June, Gemstar and S-A settled their patent litigation and signed a nine-and-a-half-year cross-licensing deal that will see S-A pay Gemstar $154 million while Gemstar will pay S-A $89 million.
Former Gemstar co-president Peter Boylan, who had been charged with securities fraud by the SEC, settled his case with the commission in June 2004, when he agreed to shell out $600,000 for a settlement without admitting or denying any wrongdoing.
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