The criminal prosecution of ex-Brocade CEO Greg Reyes over Brocade’s improper accounting for backdated stock options continues today. In oral argument on July 6, Judge Breyer made a number of comments that appeared to reveal his concern that the government had not presented enough evidence to prove beyond a reasonable doubt that Reyes was aware that Brocade had improperly accounted for certain backdated stock options. On Monday, July 9, however, Judge Breyer postponed his decision on Reyes’ motion to dismiss and ordered the defense to begin presenting its case. Judge Breyer stated that he will likely rule on the motion to dismiss on July 19th. For a discussion of the motion to dismiss, see here.
Even though Judge Breyer may be favorably disposed to the defense’s motion, for strategic reasons he may choose to further postpone his decision until after the jury has given its verdict. If Judge Breyer were to dismiss the case, his decision would likely be appealed by the government. If the jury were to acquit Reyes, however, Judge Breyer would not have to rule on the legal issue and the government would have little grounds upon which to appeal.
