Shareholders Speak Up, Then They Sue: Derivative Lawsuits Follow Negative Say-on-Pay Votes.
Mondaq Business Briefing › Nbr. 2011, January 2011
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Shareholders Speak Up, Then They Sue: Derivative Lawsuits Follow Negative Say-on-Pay Votes.
A version of this article will appear in the winter 2011 Informer magazine, published by Thomson Reuters.
Focus on corporate executive compensation levels and practices is at an all-time high, thanks in large part to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) enacted in 2010.1 The Dodd-Frank Act mandated that public companies give their shareholders some say on executive pay, by allowing the shareholders to vote on non-binding resolutions regarding executive compensation. And perhaps not surprisingly, when the shareholders' voices have been ignored, lawsuits have followed. To date, shareholders have sued the boards of directors of at least nine companies that did not receive majority approval on say-on-pay proposals. These derivative suits have been filed in various state and federal courts across the U...See the full content of this document
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