Pension fund sues Hewlett-Packard over Carly Fiorina $21.4 M severance

[Bush_Eats_Beef]

Pension fund sues Hewlett-Packard over Fiorina severance
Silicon Valley/San Jose Business Journal - 2:50 PM PST Tuesday
by Timothy Roberts

http://www.bizjournals.com/sanjose/stories/2006/03/06/daily30.html?f=et79&hbx=e_du

A union and a pension fund Tuesday sued Hewlett-Packard Co. over the severance package paid to former CEO Carly Fiorina on Feb. 8, 2005. The lawsuit is a class action filed on behalf of stock holders.

According to the suit, filed in U.S. District Court for the Northern District of California, the payout to Fiorina exceeded the company's policy. That policy limits payouts to no more than 2.99 times the sum of the executive's current annual base salary plus annual target bonus unless stockholders approve something larger.

The limit on payouts came about as a proposal by the Service Employees International Union after the H-P board gave Michael Capellas, the CEO of Compaq Computer Corp., which was acquired by H-P, a $16 million good bye package in 2002.

Fiorina's package of at least $21.4 million exceeds the policy by $7.4 million, the SEIU and the Indiana Electrical Workers Pension Trust Fund. "The board breached the severance policy and it's fiduciary duties," the plaintiff's say. HP Spokesman Ryan Donovan said the company "believes the lawsuit to be without merit."

[BootinUp]

1. I am so sick of these greedy CEO's and board members

Raise the tax rate on em, class warfare!

[napi21]

2. I sure hope the pension fund wins, but I'm not so sure they will.

Courts are very hesitant to voer-rule business board decisions. Personally, I think the board members are all way to cozy with the execs and that's why this is happening. The only thing that's going to change it is if the stock holders bit*h!

Good luck to the fund!!!!!

[niallmac]

3. Wasn't she fired? Why do you get millions....oh never mind.

Corporations are another dimension.

[Freedom_Aflaim]

4. That suit is without merit, but that kind of package is excessive

Absolutely amazing that she gets 21 million as a goodbye package for basically screwing up the company.

As they said in Barbarians at the Gate, that isnt just FU money, that is FUCK EVERYBODY money.

But as excessive as it is, the board is free to give out packages like that. Policy is not law. Policy is just rules set by the board or its delegates. If anyone can choose to ignore policy, its the board.

What will happen is that the suit will be settled out of court. Several lawyers will get millions in fees, and the shareholders will get pennies per share (or less). Literally.

Fiorina screwed the shareholders. The board then screwed the shareholders. Now the lawyers will screw the shareholders.

And everyone who screwed the shareholders, did so in the name of protecting the shareholders.