June 30, 2016
FDIC’s “Golden Parachute” Rule Enforced
– Broc Romanek, CompensationStandards.com
Here’s a blog by Paul Hasting’s Mark Poerio:
The 8th Circuit refused in Rohr v. Reliance Bank to order payment of severance to a CEO, holding that the FDIC had not been arbitrary and capricious in applying its golden parachute rule. The court’s decision reviews other cases in which courts interpreted and applies the FDIC’s golden parachute rule. The court also addressed the regulatory misnomer that arises from application of the FDIC’s regulation to severance situations unrelated to a change in corporate control. The 8th Circuit stated: “Finally, Von Rohr attacks the FDIC for disregarding the common meaning of golden parachute payment. However, because the term is given a specific definition in the statute, the common meaning is irrelevant.”