Mercury News reports that "three current and former eBay executives, including Chief Executive Meg Whitman, have agreed to pay $3 million to settle a lawsuit that they inappropriately accepted shares in scores of lucrative IPOs from investment-banking firm Goldman Sachs Group."
Whitman, along with eBay founder and Chairman Pierre Omidyar and former President Jeffrey Skoll, will pay the money into a fund controlled by the company. Goldman Sachs will also make a payment of $395,000, part of the settlement with eBay shareholders
The case concerns "spinning," the now-banned practice by which investment banking firms would dole out to favorite clients the lucrative opportunity to purchase shares in initial public offerings they were underwriting. The complaint alleges that Goldman allotted such opportunities to senior eBay executives in order to secure their position as eBay's investment banker, and that these executives should have offered that opportunity to eBay itself.
