ExecutiveLoyalty.org

New Developments  as of 2017.03.14


2017.03.14  Director Compensation - Survey Data and Precautions

The two should be considered hand-in-hand these days: survey data about director compensation, and precautions against litigation alleging it is excessive.  This is because the best protection for directors comes from two steps drawn from a recent survey discussed here.

  

2017.02.07  Stock Award Web Process Works: Non-compete Enforced.   As a general matter, employers “win” when they seek to enforce stock plan terms that have been fairly disclosed -- and accepted -- by award recipients.  ADP recently had such a victory.  In a case decided under New Jersey Law, the 3rd Circuit upheld the granting of a preliminary injunction against two former employees who had joined a competitor in violation of restrictive covenants set forth in their stock awards.  The former employees argued that ADP’s web-based system for issuing stock awards did not adequately alert them to the consequences of the stock awards they accepted. They lost because . . . continued at New Jersey Law.


2017.01.21  Equity Awards - When No Good Deed . . . Employers often assume that they will avoid litigation when acting in what they believe will be the best interests of their employees. For instance, shortening a vesting schedule from 4 years to 6 months would seem favorable to stock option holders. Until they sue. That's what Uber faces from a complaint alleging . . .  continued at Stock Award Litigation


2017.01.10  Top Hat Forfeiture Enforced for Executive's Refusal to Sign Non-Compete (WD Penn).  As a general matter, employers win when they seek to enforce the unambiguous terms -- and forfeiture provisions - of their top hat and other executive-only ERISA plans.  Good faith administration by the employer is ordinarily sufficient.  Case in point: a Penn. district court upheld forfeiture of top hat benefits where an executive refused to sign a non-competition agreement that the underlying plan required as a condition for benefits.  The court's decisions are worth review because they dig into . . . continued at Vesting and Forfeiture

 

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