A pension fund affiliated with the International Brotherhood of Teamsters has accused Apple of improperly compensating CEO Tim Cook and four other executives from 2021 to 2022. Plaintiffs allege that Apple miscalculated the value of performance-based stock awards, resulting in payments that exceeded the scheduled amounts.
According to the plaintiffs, the compensation committee intended to award each executive $77.5 million annually. But Apple paid Mr. Cook et al. $92.7 million and $94 million, respectively, based on the pension fund’s claims that the “fair value” of the stock awards was incorrectly calculated at the time of the grant award. is said to have been awarded.
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Interesting legal victory for Apple. A lawsuit alleging overpayments to CEO Tim Cook and other executives has been dismissed. This highlights the importance of accurate calculations in performance-based stock compensation.
— Cordelia.eth ⚡🏆 (@icordelia__howe) February 8, 2024
The dispute centers on whether Apple properly disclosed its compensation methods to shareholders, who cast advisory votes on executive pay during a “Say on Pay” session. The pension fund claims shareholders were misled by Apple’s proxy statement.
However, U.S. District Judge Jennifer Rochon ruled in Apple’s favor, saying the company’s 2023 proxy statement accurately describes the company’s compensation practices in accordance with securities laws and U.S. Securities and Exchange Commission rules. I put it down. The judge found there was no evidence that Apple’s board of directors acted improperly in determining executive compensation.
Additionally, Judge Rochon noted that the plaintiffs did not give Apple’s board sufficient time to address their objections before filing the lawsuit.
Tim Cook’s total compensation will amount to approximately $99 million annually in both 2021 and 2022, with more than $82 million of that attributable to stock compensation each year, according to Apple’s proxy filings. Became. However, Cook’s total salary for 2023 has decreased to $63.2 million.
The ruling marks a victory for Apple in its legal dispute over executive compensation and confirms the company’s compliance with regulatory requirements and corporate governance standards.
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