Now in Legal Rebels:
Posted Apr 23, 2007 04:13 pm CDT
Qwest Communications has a good case to recover some of the legal fees advanced to Joe Nacchio, according to experts quoted in the Denver Post, but it’s unclear if the company will pursue a case.
Prosecutors had alleged Nacchio sold more than $100 million in Qwest stock when he knew of the company’s financial problems, but did not disclose them. The former CEO was convicted of 19 counts of insider trading on Thursday.
John Toothman, founder of The Devil’s Advocate, a legal-fees consulting firm, told the newspaper there is no longer a presumption that the company must stand by its officer, but there may be no money available for recovery.
A Qwest spokesman would not say how much the company paid for Nacchio’s fees, or whether it would seek reimbursement.
In a separate story, the Post says Nacchio did not have to sign financial-disclosure documents filed with the Securities and Exchange Commission because the Sarbanes-Oxley Act had not been enacted yet.
Experts are divided on the value of the law, passed in the wake of corporate scandals, the newspaper says.