KB Home Case Has High Stakes for Prosecutors

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Two months after the federal government’s criminal cases against Broadcom Corp.’s top executives collapsed, the U.S. attorney’s office is taking aim at another stock-options backdating target: former KB Home chief Bruce Karatz.

The stakes will be high for federal prosecutors when Karatz’s trial starts Tuesday in Los Angeles.

Not only will they be seeking to punish a man they say flouted federal law while making millions of dollars for himself and his employees, they’ll also be seeking to improve the record of a massive options crackdown that so far has yielded few convictions.

Several high-profile options trials have backfired on prosecutors — most recently their cases against Henry Samueli and Henry T. Nicholas III, co-founders of Broadcom, the Irvine chip designer.

• Read the full Los Angeles Times story.

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