A shareholder lawsuit has been filed in King County Superior Court accusing Issaquah-based Costco Wholesale of manipulating stock-option...
A shareholder lawsuit has been filed in King County Superior Court accusing Issaquah-based Costco Wholesale of manipulating stock-option grant dates between 1997 and 2002 to maximize profits for executives.
Fosler Law Group of Bellevue, in partnership with a San Diego law firm, filed the 67-page lawsuit July 17 on behalf of shareholder Sandra Donnelly. The suit against Costco board members and top executives seeks unspecified damages.
In 2006, Costco appointed three of its directors to examine the company’s options grants from 1996 to 2005. The company said that although in several cases the directors could not determine when options had been granted, they found no evidence of fraud, falsifying records or intentionally deviating from generally accepted accounting principles.
In March 2007, Costco revealed that it had been subpoenaed by a federal grand jury in Seattle looking into its options grants. An investigation by the U.S. Attorney’s Office is ongoing, according to the lawsuit.
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