Posted May 09, 2007 02:53 pm CDT
The former chairman of the New York Stock Exchange has won a significant legal ruling in his fight to keep a $190 million pay package.
The suit, filed by then-Attorney General Eliot Spitzer in 2004, had claimed that Richard Grasso’s accumulated compensation was unreasonable and that he did not disclose soaring pension benefits to the board, the New York Times reports.
The Appellate Division of the New York Supreme Court ruled that the attorney general did not have the authority to bring four of six causes of action, including claims that Grasso’s pay was unreasonable under the state’s nonprofit law.
Now Spitzer’s successor will have to show that Grasso knew he was doing something wrong or violated his fiduciary duty, according to the Wall Street Journal.
Michael W. Peregrine, a partner at McDermott Will & Emery, told the WSJ that the ruling may hamstring oversight activity by attorneys general in the nonprofit sector.
A separate pending appeal challenges a judge’s October ruling that Grasso should return $100 million or more because he breached his fiduciary duty.