William Gallagher
A lawsuit alleging that Apple mistakenly overpays its executives including Tim Cook, by tens of millions of dollars, has been dismissed.
As with most corporations, the renumeration for its top executives is a complex mix of a base salary, performance-related extras, stock and more options negotiated individually. Overall, Tim Cook's pay for 2023 was reduced — at his request — to $63 million, but a lawsuit claimed that this and the amounts paid to other executives, were too high.
The case was brought by the International Brotherhood of Teamsters, Garage Employees Local 272 Labor Management Pension Fund. According to Reuters, the case specifically alleged that Apple overpaid by tens of millions of dollars.
In 2021 and 2022, claimed the suit, Apple's compensation committee intended to award $77.5 milion. However, through what was alleged to be an improper calculation of the fair value of performance-based restricted stock units, Cook was awarded $92.7 million and $94 million for those years.
The four other Apple executives, whose names have not been announced, each received over $26 million for 2021, 2022, and 2023.
However, US District Judge Jennifer Rochon in Manhattan has dismissed the case, ruling that Apple has reported its pay methods "precisely" as the US Securities and Exchange Commission requires. Judge Rochon also said that she found no proof that Apple's board of directors acted improperly in awarding pay.
The judge further said that the plaintiff had not given Apple's board enough time to consider its objections, before suing.
Neither Apple nor the pension fund connected to the International Brotherhood of Teamsters, has commented on the ruling.
Wesley Hilliard
Marko Zivkovic
Malcolm Owen
Andrew Orr
Christine McKee
Andrew O'Hara
12 Comments
Not to pick nits, but the correct word is remuneration, not renumeration.
Thought Tim Cook was under paid when I compare to $55B car maker Tesla CEO's compensation.
Many, may CEOs are overpaid. So these types of law suits hinge on whether CEO X is overpaid RELATIVE to CEOs Y, Z, and W. And Tim Cook is not overpaid relative to the other overpaid CEOs, so quite rightly, Apple wins the suit.
But that doesn't mean there isn't a problem. It's just that we need a different solution. And I think that different solution is a much, much higher *marginal* tax rate on these very high incomes. Like, say, 90% (as it was in the 1950s, back when America was "Great").
Not saying it's going to happen, just that it should.