A federal appeals court Wednesday upheld the conviction of former Monster president and COO James Treacy, but ordered the trial court to recalculate part of the $6.3 million it ordered him to pay in forfeitures.
Treacy was convicted in May 2009 of stock options fraud in connection with the granting of backdated Monster stock options. He was sentenced in Sept. 2009 to two years in prison, fined $6.3 million and the same in forfeitures. (The amount was determined to be how much Treacy profited by the backdating of stock options he was granted.)
He appealed his conviction and challenged the trial court’s calculation of the restitution. The appeals court ruled against him on all but one issue: how the judge figured the forfeiture amount for 75,000 options with a grant date in December 1998. The revisions ordered by the appeals court will result in a somewhat smaller total amount of forfeitures.
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Treacy is the only former Monster executive to receive prison time in connection with a stock options backdating scheme that netted the recipients — including Treacy — millions. Andrew McKelvey, who founded TMP Worldwide, which owned Monster, and was the company’s CEO and chairman, was accused of stock fraud, but because of his terminal pancreatic cancer, was allowed to defer his prosecution after he admitted his guilt in court. McKelvey died in November 2008.