Activision reports on stock options

Based on an internal investigation, CEO Bobby Kotick is in the clear, as far as "intentional wrongoing" in the way the Santa Monica-based videogame company handled the granting of stock options. Four unnamed individuals (the outgoing head of human resources, former heads of finance and legal, and a former outside legal advisor) "bore significant responsibility, in varying degrees, with respect to the measurement date inaccuracies," otherwise known as backdating. The board's subcommittee looking into the backdating issues is recommending that 10 current and former officers and directors should return any overages from misdating and mispricing the options. There are other recommendations, such as hiring new outside legal advisors and changing the process for granting and reporting options. The company released its findings after the market closed. Activision, of course, wants it all to go away, but the SEC is still conducting a formal investigation - as it's doing with dozens of other companies. The agency, however, is having a tough time determining how to penalize companies that engage in backdating.