CalPERS Settles Lawsuit With W.R. Grace & Co.; Pension Fund Recoups Nearly $4 Million in Losses.SACRAMENTO, Calif.--(BUSINESS WIRE)--Oct. 13, 1999-- The California Public Employees' Retirement System (CalPERS) announced today that the New York Supreme Court For the highest appellate court in New York, see . The Supreme Court of the State of New York is New York State's highest trial court, and is of general jurisdiction. There is a supreme court in each of New York State's 62 counties, although some of the smaller counties share has approved a settlement of a shareowner's lawsuit against the former officers and directors of W.R. Grace & Co. (Grace). The settlement has recovered nearly $4 million of shareowners dollars that were part of a severance package A severance package is pay and benefits an employee receives when they leave employment at a company. In addition to the employee's remaining regular pay, it may include some of the following:
"This is a clear victory for CalPERS and shareowners of W.R. Grace," said Charles P. Valdes, Chair of CalPERS Investment Committee. "This settlement serves as a reminder to all corporations that shareowners won't stand by and let their interests be taken for granted Adj. 1. taken for granted - evident without proof or argument; "an axiomatic truth"; "we hold these truths to be self-evident" axiomatic, self-evident obvious - easily perceived by the senses or grasped by the mind; "obvious errors" and their capital wasted." Additionally, Grace has agreed to adopt a strong policy on sexual harassment sexual harassment, in law, verbal or physical behavior of a sexual nature, aimed at a particular person or group of people, especially in the workplace or in academic or other institutional settings, that is actionable, as in tort or under equal-opportunity statutes. which CalPERS believes can be a model for corporate sexual harassment policies throughout the country. In March of 1995, Grace directors awarded Bolduc approximately $20 million in severance benefits, consisting of the repurchase of shares and various cash payments, when he resigned as president and CEO. The severance package was bestowed upon Bolduc even though his employment agreement, in effect at the time of his resignation, reportedly did not require or provide for such payment. A March 30, 1995 New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times article reported that Bolduc "resigned" under pressure because of allegations of sexual harassment against him by at least five Grace employees. In 1996, CalPERS intervened in an existing shareowner lawsuit against Grace and was later named lead plaintiff in the case. In papers filed in the Supreme Court of the State of New York, the pension fund alleged that an agreement to pay enormous severance payments to Bolduc was a breach of fiduciary duty by the board members and a waste of the company's assets. Prior to the pension fund's intervention, a settlement had been proposed that would have returned no money to the corporation, and would have required the adoption of a sexual harassment policy that CalPERS believed was seriously inadequate. After CalPERS intervention, Grace adopted a number of corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. reforms, including the appointment of independent outside directors to serve on the company's Audit, Compensation and Nominating committees. CalPERS is one of Grace's largest shareowners, owning approximately 1.3 million shares of common stock. The System was represented in the litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. by Robinson, Curley & Clayton, Sachnoff & Weaver of New York, and the law office of Klari Neuwelt. CalPERS is the nation's largest pension fund with assets of nearly $160 billion. The System provides retirement and health benefits to more than one million state and public employees and their families. For further information on CalPERS, please visit the System's Web site at www.calpers.ca.gov. |
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