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Forum activities relating to CA, Inc. are temporarily suspended pending release of a court-appointed Examiner's report on management compliance with a Deferred Prosecution Agreement.

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For related communications with CA management concerning the request for public release of the referenced Examiner's report, see




Sent: Monday, September 22, 2008 2:58 PM
Subject: Process initiated seeking court approval to release Examiner's report, opposed by management

CA's management did not respond to the suggestion that they reconsider initiating the legal process required for the court to determine what parts of the Examiner's reports it will approve for public release.  I therefore sent a letter myself to the court on Wednesday afternoon asking the judge's guidance to start the process.  CA engaged counsel to respond the next day with a vigorous opposition letter to the court, arguing that everything in the Examiner's reports should be kept secret.  Considering it a matter of director responsibility to support the release of all but the confidential information rather than try to hide everything, I've asked CA's board to let me know by today if they will follow conventional practices in this matter before we proceed to argue any remaining legal issues.
The texts of my September 17 letter to the court and Setpember 19 letter to the chairman of CA's board are copied below in inverse chronological order, and a scanned copy of the September 18 letter from CA's lawyer to the court can be downloaded from a link presented between those two letters.
It should be noted that the lawyer engaged by CA management to oppose the report's public release, Robert J. Giuffra, Jr., of Sullivan & Cromwell, was himself the subject of statements in the recently reported Kumar accusations of a cover-up, concerning Mr. Giuffra'a interest in protecting his patron, continuing CA director Alphonse D'Amato.  (See particularly paragraphs 94-97 and 103 of the Kumar Declaration.)  Those of you who have been following CA developments may recall that Mr. Giuffra was the lawyer engaged in 2003 when government prosecutors forced CA to conduct an "independent internal investigation," and that he later provided extensive information about his confidential client communications to tell his version of what happened in a front page Wall Street Journal report of the negotiations leading to CA's Deferred Prosecution Agreement.
I will of course continue to keep you informed of developments, and will welcome your comments.
Gary Lutin
Lutin & Company
575 Madison Avenue, 10th Floor
New York, New York 10022
Tel: 212-605-0335




Lutin & Company


575 Madison Avenue – 10th Floor, New York, New York 10022

Telephone: (212) 605-0335

September 19, 2008


By email


Mr. William E. McCracken

Chairman, Board of Directors

Computer Associates International, Inc.

One Computer Associates Plaza

Islandia, New York 11749


Re:       September 9, 2008 demand for records


Dear Mr. McCracken:

            The letter CA’s attorney sent to the Court yesterday (referring to SEC v. Computer Associates International, Inc., Civil Docket No. 04-4088, and USA v. Computer Associates International, Inc., Criminal Docket No. 04-837), a copy of which is attached, raised issues that are a matter of board responsibility.  I therefore ask you to respond to these issues before I consider the engagement of counsel to address any legal issues that may remain for the Court’s review.

            These board issues are summarized in the order they were raised in your lawyer’s three arguments, as presented on page 3 of his letter:

  1. Misimpressions of right to demand records:  In suggesting to the Court that there may be questions about my right to pursue a shareholder demand for records, your attorney seems to be unaware that CA has accepted without dispute both the relevant Delaware law and the documentation evidencing my power of attorney and the share ownership.  In fact, his own firm had recognized the authority of a previous Delegate under similar circumstances.[1]  I asked your attorney in a note yesterday to correct the possible misimpressions, but have not received any response.  It is in any event CA’s responsibility to assure that its representative is fully informed and presents facts properly, and it is the board’s responsibility to oversee this.  Particularly in this context of a report about your compliance with disclosure and integrity requirements, I assume you will appreciate the need for the board to demonstrate its reliability.

(This issue of shareholder rights to demand records should not be confused with an issue of my standing as a party in the cases before the Court.  As stated in my letter to Court initiating the request, I recognize that I am not a party in those cases and therefore asked for the Court’s guidance for appropriate procedures.)

  1. Confusion of decision responsibilities:  Your lawyer’s second argument confuses the Court’s decisions about criminal punishment with the shareholder’s rights and responsibilities to make decisions about who should represent investor interests on a board of directors.  It is up to shareholders, not courts, to elect directors, and shareholders must have access to the information that is relevant to their choices.  You should understand, too, that managers of funds have fiduciary obligations to make informed decisions about voting for directors, and that you must respect their duties.  As the DPA made clear, it is the responsibility of CA’s board to assure the company’s provision of information that is reasonably requested by investors to evaluate management’s performance, including the performance of the directors they rely upon to oversee investor interests.
  2. Pretext for avoiding disclosure:  Your lawyer’s final argument that everything should be kept secret is inconsistent with board responsibilities to the company’s shareholders.  The board should simply follow the conventional practice of determining what parts of the Examiner’s report it considers to be confidential, and then instruct the company’s attorney to ask the Court to either redact those parts or require appropriate conditions of confidentiality to cover them.  An alternative that may be practical in this case, considering past requests for the Examiner to address specific matters that concerned shareholders,[2] might be for you to ask the Court to direct the Examiner to prepare an additional “final” report for the purpose of addressing investor and public interests.

            In summary, the board can and should support the Court’s approval to release whatever information can be reasonably provided to investors.  This in itself would be seen as an indication that you have nothing to hide about your performance.  It could in fact be considered an opportunity for Mr. Swainson to include your resolution of this issue as an example of successful transformation in his October 7 presentation of a Lecture in Business Ethics, “Back from the Brink: Rebuilding a Company after a Near Fatal Ethics Breakdown,” at Bentley College, [3] which is coincidentally where Leonard Rosenthal, the shareholder who has authorized me to act as Delegate, is a Finance Professor.

            Please let me know by Monday whether I should wait for your response.  Copies of this letter are being distributed to the recipients of your attorney’s letter to inform them that my response will follow yours.


Sincerely yours,





Gary Lutin



cc:        The Honorable I. Leo Glasser (by fax)

            Robert J. Giuffra, Jr. (by email)

            Jason A. Jones (by fax)

            Alexander M. Vasilescu (by fax)

            Lee S. Richards, III (by email)

            Gary R. Brown (by fax)

            John A. Swainson (by email)




[1] See the August 2, 2005 Agreement proposed by Sullivan & Cromwell and executed by them with a previous Delegate representing the same shareholder:

[2] See my September 6, 2005 letter to the Examiner, Lee S. Richards:

[3] See the September 16, 2008 press release, “‘Back from the Brink: Rebuilding a Company after a Near Fatal Ethics Breakdown,’ Bentley College Presents Raytheon Lecture in Business Ethics, October 7; John A. Swainson, CEO of CA, Inc., to Discuss the Challenges of Taking Over a Company Facing an Ethics Scandal:”


Transition Investments, Inc.








Lutin & Company


575 Madison Avenue – 10th Floor, New York, New York 10022

Telephone: (212) 605-0335

September 17, 2008


By fax: 718-613-2446


The Honorable I. Leo Glasser

United States District Court

Eastern District of New York

225 Cadman Plaza East

Brooklyn, New York 11201


Re:       SEC v. Computer Associates International, Inc.

            Civil Docket No. 04-4088 (ILG)


            USA v. Computer Associates International, Inc.

            Criminal Docket No. 04-837 (ILG)


Dear Judge Glasser:

            In relation to the cases referenced above, I have encouraged CA, Inc., formerly named Computer Associates International, Inc. (“CA”), to request the Court’s approval to comply with a shareholder demand for disclosure of reports of an Independent Examiner.  Since CA’s management opposes disclosure of the reports and apparently will not submit the request, and since it is not clear whether I can make an application as a non-party, I ask the Court’s guidance to initiate the required review.

            The disclosure and approval provisions are in paragraph 10 of the Court’s March 16, 2005 Order of Appointment of Examiner, filed in both of the cases referenced above:

            10.  The Independent Examiner, the USAO and the Commission shall not publicly disclose or disseminate any of the Independent Examiner’s quarterly reports and/or the Final Report, except in an official proceeding of the executive, legislative, or judicial branches of the United States Government, without prior approval by the Court, after briefing by all interested parties as to the need and propriety of disclosing such report(s), in whole or in part.  CA may publicly disclose information contained in the Independent Examiner’s reports to the degree that the reports contain material, nonpublic information that CA is obligated to disclose.  CA shall not publicly disclose information contained in the Independent Examiner’s reports for any other purpose without prior approval by the Court, after briefing by all interested parties as to the need and propriety of disclosing such report(s), in whole or in part.

            As indicated in the attached copies of communications with CA, a demand was made pursuant to a law of CA’s state of incorporation which obligates a company to provide access to records relevant to investor interests.[*]  The response of CA’s management indicates that they will offer a variety of arguments to oppose disclosure, including their interpretation of state law obligations.  It is not my intent, though, to seek disclosure based on your Order’s provision for “information that CA is obligated to disclose.”  Instead, I prefer to rely on the provision for specific Court approval of the disclosure, based on your determination of what information should be properly made available to public investors.

            I will of course welcome the opportunity to be heard on the importance of the requested information to investors, and on any other issues the Court considers relevant, either personally or by counsel according to the Court’s direction.

            Please let me know how the Court will proceed with its consideration of the request.  I can be reached by email at or by telephone at 212-605-0335.

Sincerely yours,




Gary Lutin,

            as Delegate



1.  Sept. 9, 2008 letter from Gary Lutin to John A. Swainson, with power of attorney

2.  Sept. 11, 2008 letter from Amy Fliegelman Olli to Gary Lutin

3.  Sept. 12, 2008 letter from Gary Lutin to Amy Fliegelman Olli


cc:        William E. McCracken (by email)

            Amy Fliegelman Olli (by email)

            Mark Schonfeld (by email)

            Amy Lynn Walsh (by email)



[*] Additional background information about the demand, including earlier informal requests and reports of the relevance of the information to investor interests, can be found on the web site of a public Shareholder Forum program:

Transition Investments, Inc.



The Forum is open to all Computer Associates ("CA") shareholders, whether institutional or individual, and to any fiduciaries or professionals concerned with their investment decisions.  Its purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their evaluations of alternatives, as described in the Forum Summary.

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