GOING AFTER GRASSO’s MONEY - II
Court, Consent, or Common Cause?
Is resort to mutual consent the right course to take to resolve the issue of Grasso’s money when the recourse by the New York State’s Attorney General to court looks ill conceived? So often in claims suits, rather than adjudge themselves, courts ask opposing parties to compromise. Will the court in Mr. Eliot Spitzer’s lawsuit against Mr. Richard Grasso, regardless of the latter filing a counter suit he has said he will be, doing just that?
Should this be happening would the AG be saying his suit is itself to reach a settlement? For he is not claiming all of the $139.5 million which the Big Board has awarded the former chairman and chief executive officer of the New York Stock Exchange in retirement pay. He is asking for less, $100 million, of the amount.
But this would not mean a settlement really.
When court intervenes asking opposing parties in lawsuits to settle among themselves, it means this in lieu of court action. Spitzer’s saying he does not ask for all of Grasso’s money does not mean he wants less than what he has claimed in his lawsuit.
What about Grasso?
He has already pledged the very next day of Spitzer’s filing the suit against him on May 24 to file a counter suit. This means he would not give Spitzer $100 million the AG has claimed.
In the counter suit, as he has said in a signed article published in Wall Street Journal (May 25), he will be contending that all of his $139.5 million of retirement pay is “fully earned”. Furthermore, he would also claim the remainder of $48.5 million, which was not disclosed by the NYSE’s Board in his retirement package on August 27 last.
So what is there to expect by way of settlement in Spitzer v. Grasso case?
But when positions of Spitzer and Grasso are set so wide apart, compromise looks as the way out in Grasso’s money. Proceeded with on the other hand in court, the proceedings certainly are to be prolonged and prove costly. At the same time, the outcome may not be satisfactory in resolution of the matter.
As against Spitzer’s case that Grasso’s pay itself (not to mention retirement package) happened to be out of proportion of NYSE’s not-for-profit status, Grasso’s justification for all of his payment is that it was provided in contract made by the NYSE.
Even if made an issue of covenant v. contract, nowhere in Grasso’s pay was covenant made a stipulation of the contract. What was not there when contract was made cannot be brought in when the contract is to be fulfilled.
NYSE made with Grasso during his tenure of office not one but three contracts covering the terms of his pay, retirement dues and compensation. The NYSE’s board itself made them. When on August 27 last it disclosed his retirement package, the Board had unanimously endorsed it. It can be said that the Board did so because the package was covered by contract. But if that was understandable, it was important that the Board also decided to extend Grasso’s contract till the year 2007.
When as public disclosure was made concerned persons like Mr.William Donaldson, the Securities and Exchange Commission’s chairman, kicked up a howl of protest, it was still not over the package, but for demand that Grasso resign as NYSE’s chairman and CEO. In the wake of this Grasso called for a meeting of the Board to consider his position. Influential board members pre-empted Grasso and called a conference call meeting on September 17 for the single purpose to have Grasso to resign. Seven out of 27 Board members did not participate. Of the 20 who did 13 voted for Grasso to resign seven against. Grasso was ordered out of NYSE. But yet again, the Board did not question his retirement package, but told him to take it and go.
The Board was with Grasso in his millions till the end likely by way of contractual obligation.
Grasso did not defraud. Nor did he steal.
Contract is sacrosanct like property rights in democracy even if it were made to be egalitarian.
Can court abrogate NYSE’s contracts, as AG Spitzer demands, as having been outside its not-for-profit status?
All this said of Grasso’s package notwithstanding, consent is unavoidable to resolve it.
Grasso himself seems to be seeing this. Questioning Spitzer’s lawsuit challenging his package he has maintained that all of his dues were duly earned. So saying however he unwittingly gives vent to his own gut feeling that it was too much, if not far too much.
Grasso has said of his move to counter Spitzer’s suit that he would be vindicated in courtroom. He might as well think to be redeemed. Redemption will come with giving. By yielding.
Is resort to mutual consent the right course to take to resolve the issue of Grasso’s money when the recourse by the New York State’s Attorney General to court looks ill conceived? So often in claims suits, rather than adjudge themselves, courts ask opposing parties to compromise. Will the court in Mr. Eliot Spitzer’s lawsuit against Mr. Richard Grasso, regardless of the latter filing a counter suit he has said he will be, doing just that?
Should this be happening would the AG be saying his suit is itself to reach a settlement? For he is not claiming all of the $139.5 million which the Big Board has awarded the former chairman and chief executive officer of the New York Stock Exchange in retirement pay. He is asking for less, $100 million, of the amount.
But this would not mean a settlement really.
When court intervenes asking opposing parties in lawsuits to settle among themselves, it means this in lieu of court action. Spitzer’s saying he does not ask for all of Grasso’s money does not mean he wants less than what he has claimed in his lawsuit.
What about Grasso?
He has already pledged the very next day of Spitzer’s filing the suit against him on May 24 to file a counter suit. This means he would not give Spitzer $100 million the AG has claimed.
In the counter suit, as he has said in a signed article published in Wall Street Journal (May 25), he will be contending that all of his $139.5 million of retirement pay is “fully earned”. Furthermore, he would also claim the remainder of $48.5 million, which was not disclosed by the NYSE’s Board in his retirement package on August 27 last.
So what is there to expect by way of settlement in Spitzer v. Grasso case?
But when positions of Spitzer and Grasso are set so wide apart, compromise looks as the way out in Grasso’s money. Proceeded with on the other hand in court, the proceedings certainly are to be prolonged and prove costly. At the same time, the outcome may not be satisfactory in resolution of the matter.
As against Spitzer’s case that Grasso’s pay itself (not to mention retirement package) happened to be out of proportion of NYSE’s not-for-profit status, Grasso’s justification for all of his payment is that it was provided in contract made by the NYSE.
Even if made an issue of covenant v. contract, nowhere in Grasso’s pay was covenant made a stipulation of the contract. What was not there when contract was made cannot be brought in when the contract is to be fulfilled.
NYSE made with Grasso during his tenure of office not one but three contracts covering the terms of his pay, retirement dues and compensation. The NYSE’s board itself made them. When on August 27 last it disclosed his retirement package, the Board had unanimously endorsed it. It can be said that the Board did so because the package was covered by contract. But if that was understandable, it was important that the Board also decided to extend Grasso’s contract till the year 2007.
When as public disclosure was made concerned persons like Mr.William Donaldson, the Securities and Exchange Commission’s chairman, kicked up a howl of protest, it was still not over the package, but for demand that Grasso resign as NYSE’s chairman and CEO. In the wake of this Grasso called for a meeting of the Board to consider his position. Influential board members pre-empted Grasso and called a conference call meeting on September 17 for the single purpose to have Grasso to resign. Seven out of 27 Board members did not participate. Of the 20 who did 13 voted for Grasso to resign seven against. Grasso was ordered out of NYSE. But yet again, the Board did not question his retirement package, but told him to take it and go.
The Board was with Grasso in his millions till the end likely by way of contractual obligation.
Grasso did not defraud. Nor did he steal.
Contract is sacrosanct like property rights in democracy even if it were made to be egalitarian.
Can court abrogate NYSE’s contracts, as AG Spitzer demands, as having been outside its not-for-profit status?
All this said of Grasso’s package notwithstanding, consent is unavoidable to resolve it.
Grasso himself seems to be seeing this. Questioning Spitzer’s lawsuit challenging his package he has maintained that all of his dues were duly earned. So saying however he unwittingly gives vent to his own gut feeling that it was too much, if not far too much.
Grasso has said of his move to counter Spitzer’s suit that he would be vindicated in courtroom. He might as well think to be redeemed. Redemption will come with giving. By yielding.
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