Originally published in Executive Counsel, December 2011/January 2012.

If litigating a lawsuit about compensation issues is a lot like doing a "dig" at an archeological site, the options back-dating scandal was a veritable Pompeii.

When the Wall Street Journal ran its famous "Perfect Payday" article in 2006, it unleashed a torrent of internal investigations at hundreds of public corporations, which in turn led to billions of dollars in accounting restatements, as well as scores of shareholder and derivative lawsuits, SEC proceedings, and for an unlucky few, criminal prosecutions. It was as if a Vesuvius had erupted, with the flow of lava freezing in place a decade of compensation practices. Legions of prosecutors and defense lawyers were soon on the scene, chisels and brushes in hand.

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