Yuen had been convicted in 2006 of securities fraud for lying about Gemstar-TV Guide's revenues to inflate the stock price. The new obstruction of justice charge alleges he destroyed documents and emails sought by the Securities and Exchange Commission in relation to this earlier investigation.
The ex-CEO's apparent flight from justice and failure to pay $22.3 million in fines for securities fraud, lying to auditors and falsifying Gemstar's books to inflate the company's revenues by $248 million in 2000-2002, comes as an unwelcome reminder of the woes that have afflicted Gemstar-TV Guide, which was acquired by Macrovision on May 2 for $2.3 billion.
As the publication struggled to keep pace with the explosion of cable TV options, then the emergence of online video, TV Guide's ad pages fell 65%, from 3,195 in 2000 to just 926 in 2006--recovering slightly to 1,138 in 2007 after the title's relaunch as a full-sized magazine.
Market capitalization of the company, which also has a substantial electronic guide business, fell from $20 billion in 2000 to just $2 billion in 2007. After Yuen's fraud was revealed in April 2002, the company lost about $3 billion in market value.
After Yuen's ouster in October 2002 at the behest of shareholder News Corp., Gemstar-TV Guide moved aggressively to break with the past and diversify its business, probably with an eye toward the eventual sale of the company. CEO Jeff Shell, who steered the company through the worst of the post-Yuen PR storm, patched up relations with News Corp. before handing the reins over to CEO Richard Battista in December 2004.
Around the time of Yuen's conviction in May 2006, Battista appointed a new executive vice president of product management, Steve Shannon, in January 2006, a new executive vice president of sales and services, Tom Carson, in April 2006, and a new general counsel, Stephen Yu, as well as a new executive vice president of corporate marketing, Corey Ferengul, both in May 2006.