UC Law Business Journal
Abstract
Merrill Lynch suffered fourth quarter losses of $9.8 billion dollars in 2008. Simultaneous to its $50 billion federally aided acquisition by Bank of America, Merrill was given the green light by Bank of America to pay as much as $5.6 billion dollars in incentive compensation. The legal fallout regarding the losses and the bonuses has been dramatic by any standard. As a separate drama, Troubled Asset Relief Program Special Master Kenneth Feinberg has been a constant presence in the media throughout 2009, ruling on compensation proposals at companies that received federal financing. Contemporaneously, the legal and business communities are curiously watching the progression of the Securities and Exchange Commission's complaint against former Chairman and CEO of CSK Auto Corporation Maynard Jenkins. The complaint against Jenkins seeks disgorgement of Jenkins' incentive and equity compensation under § 304 of the Sarbanes- Oxley Act, and is a singular instance of § 304 being leveraged against an executive who is not personally accused of violating any federal securities laws. These legal matters are informed by larger circumstances-of populist rhetoric and of the ongoing economic crisis-that have in many instances provoked shareholders, creditors, and government actors to seek recoupment of executive compensation. This research article functions as a broad overview of the possible state and federal legal authorities parties may face in such an environment
Recommended Citation
Stephanie L. Soondar, Allen Major, and Candace Hines,
Litigation and Recoupment of Executive Compensation,
6 Hastings Bus. L.J. 397
(2010).
Available at: https://repository.uclawsf.edu/hastings_business_law_journal/vol6/iss2/3