Juniper Partners Sanguine About Kriens, Stock Options Investigation

Probably the most prominent company mentioned in this latest episode is Apple and its high-profile CEO, Steve Jobs, but also under the microscope is Juniper Networks chairman and CEO Scott Kriens. When news of the investigation first broke a few weeks ago, Juniper's stock price plummeted to a three-year low and caused at least one Wall Street firm to discontinue coverage of Juniper until it had verifiable financial information for the company.

Some industry observers, including analysts and media, have suggested the violations could ultimately threaten the tenure of the executives involved. That could be particularly significant for Juniper, where Kriens is widely regarded as an indispensable, visionary CEO. To wit, when Frank Vitagliano took over as Juniper's channel chief in March, Juniper partner Gary Jackson, CEO of Suntel Services, a solution provider in Rochester Hills, Mich., said that transition didn't affect his company much, but a Kriens departure would be a different story. "The CEO is the guy," Jackson told VARBusiness. "He's one of the visionaries in the market, so I'd be more concerned if he were the one leaving."

But even something as potentially serious as the stock options investigation hasn't shaken Jackson's faith in Kriens or in Juniper.

"I know Scott and believe he's a good person who wouldn't do anything to jeopardize the company, and I think whatever this is probably can be rectified," he said. "In general, I have a lot of faith in Juniper's management, and it sounds like this issue is more endemic to the industry than a problem at any one company."

Other Juniper partners say they've seen no reason to question Juniper's performance or prospects.

"I'm not concerned. With so many companies involved in this, there just seems to be a lot of scrutiny right now," says Rich Tear, CEO of CSCI, a solution provider in San Diego that recently was acquired by Iomega. "Scott Kriens has made all the right moves for years, and the organization today is tremendously better than it was three or four years ago."

Jackson says the breadth of the stock options investigation actually is encouraging.

"If one or two companies had this situation, I'd be much more concerned than when it's more than 100," he says. "That suggests that it's a systematic problem in the way business is done by high-tech companies, so if there are violations, let's correct them and move on."

As a Juniper shareholder as well as business partner, Jackson says he has no complaints on either count with the way Juniper and Kriens has conducted themselves.

"[This situation] has no relevance to Juniper's products or pricing, to the success they're having in the market or to the management team they've put together," he says. "If the Juniper management team turned over and dramatically changed the way they do business, I'd have to question that [as a partner]. But Kriens is a brilliant guy who's generally done good things for Juniper's employees, customers and its economy, so to think a guy like that is doing something bad is inconceiveable."