Canopy Group settles with former executives

0 Comments | Deseret News (Salt Lake City), Mar 15, 2005 | by Jesse Hyde Deseret Morning News

PROVO -- The Canopy Group, a venture-capital firm based in Lindon, has reached a settlement with three former executives ousted in December.

According to the settlement, former Canopy chief executive officer Ralph Yarro, former chief financial officer Darcy Mott and ex-corporate counsel Brent Christensen will receive an undisclosed sum of money.

Yarro also will get Canopy's 5.49 million shares of SCO stock, valued at about $22 million.

The three have resigned from all positions they held with Canopy and Canopy's 20-plus portfolio companies, according to the settlement, which was finalized Friday.

Yarro, Mott and Christensen will cease to hold any interest in Canopy.

"They feel vindicated," said Kimball Thomson, a spokesman for Yarro. "They feel grateful that they can move on with their lives."

Tony Kaye, an attorney with Ballard Spahr Andrews and Ingersoll, the Salt Lake firm that represented Canopy in the lawsuit, also said his clients were pleased with the settlement.

"Now that the litigation is over, Canopy can focus on its business," he said. "Canopy is still a force in emerging technologies. It's onward and upward from here."

In December, Yarro, Mott and Christensen were fired. They filed a lawsuit seeking reinstatement, alleging that their terminations were illegal and largely the work of Canopy founder Ray Noorda's daughter, who they say wanted control of the company.

In a countersuit, Canopy claimed that the three executives had taken advantage of Noorda's failing health to swindle the company of nearly $25 million. Noorda, 80, is said to be suffering from Alzheimer's disease.

Canopy was founded in 1992 by Noorda, the founder of Novell, with the goal of helping software start-ups in Utah get off the ground. Over the years, the high-tech incubator would invest in dozens of companies, including the SCO group, which made headlines for suing IBM and Linux users for copyright infringement.

Under the settlement, Yarro will retain his title as chairman of the SCO board. He also becomes SCO's largest shareholder, owning one- third of the company.

SCO will continue to lease its present location at Canopy's business park in Lindon, but all other ties between the software company and the venture capital firm will be severed.

E-mail: jhyde@desnews.com