Spitzer Lawsuit Against Grasso Likely To Go Ahead

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The New York Sun

A Manhattan judge said he will probably deny a motion that would have dismissed most of a lawsuit challenging the $187.5 million severance package that Richard Grasso got when he quit his chairmanship of the New York Stock Exchange in 2003.


State Supreme Court Justice Charles Ramos indicated his thinking while Mr. Grasso’s lawyer, Gerson Zweifach, was arguing that state laws deny Attorney General Eliot Spitzer the authority to sue Mr. Grasso on four of the six grounds cited in the lawsuit.


Mr. Spitzer sued Mr. Grasso last year, alleging that the pay package was excessive under New York’s not-for-profit law. He is seeking the return of as much as $100 million, saying the former exchange chairman’s pay was “unreasonable.”


In an attempt to chisel away at the suit, Mr. Zweifach argued that directors and officers of not-for-profit entities who do their jobs in good faith cannot be held liable for acts later determined to have been mistakes.


The New York Sun

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