The Justice Department said Friday that it is fining Comcast CEO Brian Roberts $500,000 for failing to notify authorities that he had acquired more voting stock in the company after Comcast bought the cable assets of AT&T in 2002.
Roberts gets voting stock as part of his compensation as chairman and CEO, and in October 2007, he wound up holding about $119.6 million worth, exceeding the $66 million threshold for reporting the acquisition of more stock, the department said.
Such notifications are required every five years after a merger by the Hart-Scott-Rodino Act of 1976, which seeks to prevent big mergers or acquisitions that are anti-competitive and could harm consumers.
Comcast merged with AT&T Broadband in 2002 in a $72 billion deal that made it the nation’s largest cable company.
The Justice Department said it’s the first time Roberts has been charged with violating the act, but it noted he had failed to file similar notices under the act twice in the past and had to make corrective filings, saying the mistakes were inadvertent.
The Federal Trade Commission said the fine was limited because the misstep was inadvertent and technical, caused by the faulty advice of outside legal counsel, that he did not gain financially and reported the violation promptly when it was discovered.
Comcast said in a statement, “We take very seriously our obligations to comply with all aspects of the Hart-Scott-Rodino Act, and, working with our lawyers, we have put in place additional safeguards to ensure that an inadvertent violation does not occur in the future.”
According to a proxy statement filed in April, Roberts controls 9.4 million super-voting Class B shares, which give him a third of the voting power in the company. The shares are worth about $219 million. His overall holdings of some 25.7 million voting, super-voting and non-voting stock are worth more than $590 million.
Comcast’s widely traded Class A shares closed up 4 cents at $23.33.
Filed Under: Industry regulations