'Investors can try to sue Steve Jobs and team'

LOS ANGELES, USA: A New York pension fund can try again to sue Apple Inc Chief Executive Steve Jobs and other officers and directors over a stock options plan that allegedly led to stock losses, a U.S. court ruled on Thursday.

A federal court dismissed a lawsuit led by the New York City Employees' Retirement System, finding among other things, that investors had not shown a link between stock dilution caused by the plan and their losses, the opinion said.

The 9th U.S. Circuit Court of Appeals upheld that finding but determined the lower court had erred in denying investors the chance to amend their lawsuit to include a potentially viable claim asserted in an earlier version of the suit.

An Apple spokesman could not be reached for comment.

The plaintiffs' lawyer, Michael Barry, said his clients plan to reassert a claim for securities fraud in place of the proxy violation claim that was dismissed.

"We are very pleased with the result at the 9th Circuit," Barry said. "Obviously, I would have liked it if they had agreed with us on the economic loss causation.

The lawsuit was prompted by Apple's $105 million restatement of financial results to account for thousands of backdated stock options grants between 1997 and 2002.

Investors contended that they unwittingly authorized the issuance of 205 million shares, or 20 percent of Apple's stock float, as a result of misleading statements in a 2005 proxy about the company's stock options plan.

The dismissed suit sought reversal of the shareholders' votes, compensatory damages for share dilution, a court-ordered accounting and declaration that the defendants are liable for damages, the opinion said.

Backdating involves setting a stock option price at a date in the past rather than the date it is issued and is legal when companies account for the price disparity in their books.

Apple was among about 170 U.S. companies touched by a government backdating probe that produced a flurry of internal investigations and a handful of civil settlements since 2006.

The U.S. Securities and Exchange Commission sued Apple's former General Counsel Nancy Heinen and former Chief Financial Officer Fred Anderson over backdating-related claims in 2007. Both paid fines to settle the lawsuits without admitting wrongdoing.

The case is: New York City Employees' Retirement System v. Steven P. Jobs et al, Case No. 08-16488, 9th U.S. Circuit Court of Appeals.