11/3/2008: Court Bars ESOP-Owned Company from Advancing Defense Costs of Officers Accused of ERISA Fiduciary Breach (PDF) (Proskauer Rose LLP)
At page 6 of 9 pages. Excerpt: "In Johnson v. Couturier, 2008 WL 4443085 (E.D. Cal. Sept. 26, 2008), a district court issued an injunction barring an employee stock ownership plan (ESOP)-owned company from advancing the costs of defense under the corporate officers' indemnification agreements with the company. The lawsuit alleged that the corporate officers had breached their ERISA fiduciary duties by engaging in a 'scheme to defraud' the ESOP-owned company by paying themselves grossly excessive compensation. The court found that plaintiffs had shown a substantial likelihood of success on this claim."
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