Brocade Backdating Prosecution on Life Support

The federal judge presiding over the stock options backdating related criminal prosecution of former Brocade Communications CEO Gregory Reyes has ordered prosecutors to file a response to the defense team’s motion for acquittal by 8 am tomorrow morning. At a hearing on Friday, the Judge grilled prosecutors relentlessly about what evidence had been presented to support the mens rea element of the securities fraud charges against Reyes, The Recorder reports. The Recorder’s report would suggest that Mr. Reyes has a very strong chance of succeeding on his motion and completely blowing out the government’s case. How significant a blow to the Justice Department’s overall backdating prosecution efforts would remain to be seen, but this would not be a good first step for the prosecutors.