Nancy R. Heinen

Nancy Regina Heinen of Portola Valley, California, was the General Counsel and Secretary for Apple Computer, Inc. (now Apple Inc.) between September 1997 and May 2006. Before Apple, she was the General Counsel at NeXT (NeXT was purchased by Apple in March 1996). Prior to NeXT she worked in the legal department of Tandem Computers and as an associate in several San Francisco Bay Area law firms. Heinen left Apple shortly before the company admitted to irregularities in its handling of executive stock option dating, and retained two criminal lawyers.^[1] Neither Heinen nor Apple commented on her departure other than to confirm it.

On April 24, 2007, the SEC filed charges alleging that she caused Apple to backdate large option grants and altered corporate records to hide the actions.^[2] According to the SEC press release, "Heinen is charged with, among other things, violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934, lying to Apple's auditors, and violating prohibitions on circumventing internal controls" based on options awarded to Steve Jobs (dated October 19, 2001 but allegedly granted in December 2001) and also option grants awarded to top company executives, including Heinen (dated January 17, 2001, but allegedly granted in February 2001).^[2] The SEC is seeking injunctive relief, disgorgement, and money penalties against Heinen, in addition to an order barring her from serving as an officer or director of a public company.^[2]

Before the SEC charges were filed, Dominique Trempont, a 3COM board member and former CFO of NeXT was quoted as describing Heinen as "one of the best general counsels in the valley. She's very competent, and a great member of an executive team... She was tough when she needed to be tough, and human when she needed to be human. I would hire her any time in any company."^[3] Former boss Jim Pooley described Heinen as "very careful, very straightforward," and that "Everything was straight and by-the-book. That's what I find so jarring about the suggestions that have been made."^[3]

According to an August 14, 2008 Dow Jones Newswire story by Judith Burns, the SEC charged that Heinen had her staff prepare documents changing the date of February 2001 grants to January, and December options grants backdated to October, in order to gain from more favorable stock purchase prices. Heinen, according to the Newswire story, also signed documents stating that Jobs's stock grant was approved at a special meeting of the board of directors, a meeting the SEC claims never occurred. The backdated reports caused Apple's expenses to be under-reported by nearly $40 million, according to the SEC.

Apple's former Chief Financial Officer Fred Anderson had already reached a $3.5 million settlement with the SEC in 2007, without admitting or denying its allegations regarding the stock-option backdating at the technology company.

Heinen settled with the SEC on August 14, 2008, agreeing to pay a total of $2.2 million to resolve all of the SEC charges against her. Heinen is to return $1.575 million of allegedly ill-gotten gains from the stock options that she received, plus interest, and will pay a $200,000 penalty.

The SEC settlement also bars Heinen from serving as a public company officer or director for five years and bars her from practicing before the SEC for three years.^[4]

She has settled without admitting or denying the SEC charges that she caused Apple to backdate 4.8 million share of stocks in options grants in February 2001 that benefited herself and other top Apple executives and a 7.5 million shares of stock in option grant in December 2001 that benefited Apple executive Steve Jobs.

Heinen's return of the money with interest and the penalty payment will end the civil suit filed in California federal court by the SEC in April 2007 that would otherwise have gone to trial in 2009. A two-year criminal investigation into the matter by the U.S. Justice Department was closed without criminal charges being filed.

Heinen received a Bachelor of Arts in Psychology and English from the University of California Berkeley and a Juris Doctor from Boalt Hall Law School in 1982. Her husband, attorney Dennis DeBroeck, is a partner in the corporate group at Fenwick & West law firm, which is counsel to Apple Inc.

References

1. ^ "Apple CEO knew of backdating". Global Technology Forum. 2006-10-05. http://globaltechforum.eiu.com/index.asp?layout=rich_story&doc_id=9465&categoryid=&channelid=&search=. Retrieved 2006-12-25. 
2. ^ ^{a b c} "SEC Charges Former Apple General Counsel for Illegal Stock Option Backdating". SEC. 2007-04-24. http://sec.gov/news/press/2007/2007-70.htm. Retrieved 2006-04-24. 
3. ^ ^{a b} Scott Duke Harris, Top Lawyer Known for Her Integrity: Scandal Surprises Former Colleagues, San Jose Mercury News, January 7, 2007
4. ^ http://www.sec.gov/litigation/litreleases/2008/lr20683.htm

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