Can employees sue the Director/President/CEO?
After taking over in 2007, he has driven the company into the ground in order to fund another business enterprise, and come April the main business, which has been around for a long time and is a publicly traded company, is going to come tumbling down. His other business enterprise is failing, too, but, he isn't giving up on that one yet. He has been trying to sell the main one for awhile, but, no one wants to buy the company bc of how much damage he has caused it. He owes more than 30 mil in loans, which comes into repayment in April. What, if anything, can the employees do? His total compensation for 2010 was 1.198 mil, while the CFO's was 498k, the COO was 481k. No one outside of management, has received a raise in more than 3yrs, either. Can they sue?
It is all in the company's fin report and on Forbes. Enough proof?
oh, and when should they make their move? Before everyone loses their job or after? Please include legal websites if poss. Thank you.
- Mujer AltaLv 78 years agoFavorite Answer
Normally, the executives of American corporations (including LLCs, etc.) have legal immunity. Unless they've committed fraud or embezzelment or some other crime, they are untouchable. Shifting monies between companies isn't against the law. If it was, the executives and lawyers of every large company liable to US taxes would be in federal prison. To make matters worse, no matter how incompetent the execs are, because they were hired by the company's board of directors, the board usually protects them (and the board's reputation) from retribution, legal or financial.
The corporation can be sued. The problem with this is that the company has a lot more money than the little peeps who sue them. They'll drag out any civil suit against them until the opposition is broken and broke.
There's nothing in the law that compels a company to give raises, to provide pensions or health care, etc. Even if these things are "promised" in writing. All a company has to do is scream financial need and they're off the hook for the "extra expense". Raiding pension funds is old news. The feds (i.e., us taxpayers!) step in to pay pensions that have been unfunded, underfunded or tied to company earnings/stock which have tanked. "Our" government protects American companies from having to deal honestly and fairly with their employees.
China has a better system that makes the executives of their companies legally responsible to the point of being executed for their crimes. As a shareholder in Bank of America I wouldn't mind seeing its former CEO, Kenneth Lewis, sent before a firing squad for his purchase of Merrill Lynch and Countrywide - which tanked our stock. BofA then took a $45 billion handout from Uncle Sam (i.e. us taxpayers!). Under pressure from investors, Lewis just picked up his Golden Parachute and left the company.
- Mongo KhanLv 68 years ago
As it is a publically traded company, the report and complaint should go to the SEC.
You could buy one share of the stock and then you could sue him as a stockholder.
Chances are he has committed fraud so the state attorney general would be interested in hearing about that.
There is many things that could be done to get rid of him but the damage has been done. What is important is showing the fraud and recovering the money so the parent company can rebound.
Is his name Mitt?
- PatLv 78 years ago
Anyone can sue anyone else for anything at any time.
Winning in court is another matter entirely.
However, I don't see exactly what you think you're going to sue FOR.
There is no law that limits executive pay.
There is no law guaranteeing you a raise every year.
There is no law prohibiting morons from running companies.
You have no evidence of anything wrong.
- IXI.Chris.IXILv 48 years ago
Yes the employees can file a class action against him. However they have to prove that the raise was promised to them. Otherwise they are screwed. He can also be sued by the bank or wherever he got the loans at if he doesn't pay then off.
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- NeilLv 78 years ago
Employees, no. Stockholders, yes.
- 8 years ago
yes, and obviously have proof and a good lawyer