Goldman sued by pension fund and individual shareholder over bonuses

[xiamiam]

http://www.reuters.com/article/idUSTRE6065UO20100107?feedType=RSS&feedName=businessNews&utm_source=feedburner&utm


Goldman sued by pension fund over bonus plans
NEW YORK
Thu Jan 7, 2010 6:19pm EST
Flags fly outside of the Goldman Sachs headquarters building in the financial district of New York May 8, 2009 file photo. REUTERS/Lucas Jackson

NEW YORK (Reuters) - Goldman Sachs Group Inc was sued on Thursday by an Illinois pension fund seeking to recover billions of dollars of bonuses and other compensation being awarded for 2009, saying the payouts harm shareholders.

In a lawsuit filed in New York state supreme court in Manhattan on behalf of shareholders, the Central Laborers' Pension Fund said Goldman had by September 25 set aside nearly $17 billion for compensation and might pay out more than $22 billion for the year. It said this "highlights the complete breakdown" of corporate oversight.

The lawsuit contends that Goldman's revenue for the year was artificially inflated by government bailouts of the banking industry and the insurer American International Group Inc, as well as a change in Goldman's fiscal year.

Such sums, and Goldman's practice of continuing to pay out nearly 50 percent of net revenue as compensation, show "scant regard" for the interests of shareholders, it said.

Goldman spokesman Michael DuVally called the lawsuit "completely without merit." Other defendants are Chairman and Chief Executive Lloyd Blankfein, Chief Operating Officer Gary Cohn, Vice Chairman J. Michael Evans, Chief Financial Officer David Viniar, and 10 directors.

An individual shareholder, Ken Brown, filed a similar lawsuit in the same court on Tuesday.

more at above link

This is good news...somebody has got to hold these crooks accountable...

[chimpymustgo]

1. This is a good story. Why don't you clean up your post, and delete all the unnecessary text?

[xiamiam]

7. thanks..just posted it without reading..was a little shocked when i came back and saw all that junk.

[hobbit709]

2. Bankster, meet Madame Guillotine.

[T Wolf]

6. Madame Guillotine is EXACTLY what is needed to rein in the banksters and the other corporate

owners of BOTH parties.

A lawsuit will accomplish nothing because, on the off-chance that it actually succeeds, Goldman will simply pay from our tax dollars they have already received.

The time for direct action against the "bad actors" in these crimes is long past.

[KharmaTrain]

3. This Is How To Get 'Em...

Call it "corrective capitalism". The more we learn of the bailouts the more we find certain stockholders got help while others were told to suck gas. Also that many investors were sold a bag of manure that the banks knew were bogus and now are going to get the accountability that the government is too scared to go near.

The bonuses are the pathway to learning about all the games that were played. Many were lured into high risk securities and assured they were "safe"...the 15-20 percent annual gains would go on for ever and ever. We'll soon learn about what a pyramid scheme this really was.

The sad thing is this will probably take years for the courts to settle out...corporate lawyers will pull every trick out of the bag to delay or have these suits dismissed.

[xiamiam]

8. since the action of the banksters is continuing to erode the middle class

i personally believe many of us have a 'case' against them not just their shareholders...right up front, i know nothing about law..but, it seems to me that making bogus loans from one department and then betting against them in order to make billions from another department was the trigger which set us into this downward spiral...in my area, home prices have fallen 60%...that means that anyone who bought a home in the last ten years is underwater...almost...certainly, cant blame the average american who was just trying to get a piece of the american dream...instead the banksters get bonuses for bankrupting joe and jane smith...

[NJmaverick]

4. Very good, I hope they win

[naaman fletcher]

5. They won't win, not even close.

The shareholders run the company through their electing a board of directors. Yes, in my opinion the directors are all compromised, but for shareholders to win this that would have to prove that the directors were being grossly negligent. GS has been paying out 50% of revenues in compensation for years, and this pension fund would have known that and still have been shareholders for years. They can't win.

[NJmaverick]

10. Will there be a jury trial? If there is, I wouldn't rwrite off their chances

[naaman fletcher]

11. Probably not..

GS will probably be able to get it dismissed before trial.

[dixiegrrrrl]

9. "pay out nearly 50 percent of net revenue as compensation"??!!

:wow: :wow: .....nothing is more telling than that.