Former Officers of TVG Parent Charged by SEC
Henry Yuen, the former chairman and CEO of Gemstar-TV Guide International, parent company of the Television Games Network (TVG), has been charged in a civil lawsuit by the Securities and Exchange Commission with securities fraud, lying to auditors, and falsifying the company's books.Also charged was Gemstar-TV Guide's former chief financial officer, Elsie Leung. Both were terminated from their positions by the Gemstar board in March and are no longer associated with the company.The SEC alleges Yuen and Leung overstated revenue by $223 million over a 2 1/2-year period from 2000-02. The suit alleges Gemstar reported revenue from expired license agreements along with payments that would only come if the company won specific patent lawsuits against licensees. In several cases, Gemstar lost the patent lawsuits.The SEC alleges Yuen and Leung made millions of dollars in bonuses and stock options as a result of the misstated revenue. The regulatory body seeks a return of that money and is trying to block millions more in payments to Yuen and Leung from termination agreements. It also wants to keep both individuals from serving as officers of a public company and is seeking civil penalties.Current management said in a statement that it "has resolved the past accounting issues, and has taken significant steps towards the resolution of associated regulatory issues."Gemstar-TVG Guide was dealt another patent setback on June 19 when a federal judge upheld an argument from Echostar, owner of the Dish Network, that Gemstar did not fully own a patent on an electronic television program guide. The ruling appears to clear the way for a lawsuit by Echostar alleging antitrust violations against Gemstar.In other news regarding Gemstar-TV Guide, the company said it is going to phase out its electronic book division. The company had been at the forefront of the e-book publishing world, but the technology has not caught on with the public.
Date Posted: 6/20/2003 10:43:52 AM
Last Updated: 6/23/2003 8:54:38 AM
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