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Gemstar Execs Lose High Court Appeal

October 12, 2005|From Bloomberg News

Two former executives of Gemstar-TV Guide International Inc. lost a U.S. Supreme Court appeal that claimed federal securities regulators lacked authority to freeze their severance pay totaling $37.6 million.

The court in Washington on Tuesday declined to hear the appeal by former Gemstar Chief Executive Henry Yuen and former Chief Financial Officer Elsie Leung. They face a December trial in the Securities and Exchange Commission's civil lawsuit accusing them of inflating revenue by at least $223 million.

During its investigation, the SEC obtained a court order freezing $29.5 million in severance pay for Yuen and $8.1 million for Leung. The SEC acted under the 2002 Sarbanes-Oxley Act, which allows the agency to freeze payouts to corporate officers under investigation.

Los Angeles-based Gemstar publishes TV Guide and licenses technology for on-screen TV program guides and program listings. News Corp. owns a controlling stake in Gemstar.

Also, Yuen pleaded guilty Oct. 4 in federal court in Los Angeles to criminal charges of destroying subpoenaed documents during the investigation into accounting irregularities.

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