Netflix Wants Executive Bonuses Suit Tossed; Calls Objections “Entirely Novel”

Deadline | 6/11/2018 | Dominic Patten
Click For Photo: https://pmcdeadline2.files.wordpress.com/2018/05/rexfeatures_9386582a.jpg?w=605

The jockeying of Emmy season will have long since passed, but Netflix is hoping a December hearing in federal court will see them awarded the dismissal of a lawsuit over executive bonuses.

The streaming service wants the actions of shareholder the City of Birmingham Relief and Retirement System back in the spring tossed “on the grounds that Plaintiff lacks standing to pursue this action because it did not make a pre-filing demand on Netflix’s Board of Directors and has not pleaded particularized facts demonstrating that such a demand would have been futile” (read it here).

OK.

In a board rules-heavy and well-parsed motion filed late last week, the Reed Hastings-run home of House of Cards rejects the assumptions of the efforts by the Alabama group on the “rigged the compensation process” that saw Chief Content Officer Ted Sarandos pocketing $10.5 million and several others receiving pretty hefty payouts too. Essentially, the Birmingham investors alleged that Netflix used a once viable tax loophole to deduct deep-pocket bonuses for execs pulling in over $1 million annually if the award was linked to performance goals that could be determined as — and you have to love this language — “substantially uncertain” to be achieved.

Year - City - Birmingham - Relief - Retirement

Earlier this year, the City of Birmingham Relief and Retirement System called BS on the actuality of that phraseology and the methodology supporting it by claiming the streamer knew exactly what the revenues were going to be when subscription levels were factored in – hence nothing uncertain at all. Their suit seeks damages based on Netflix board members violating fiduciary duty. As a result, the shareholder is putting the hurt on for the return of all compensation paid out during the time Netflix was supposedly in breach.

Not so says Netflix, terming the overall argument...
(Excerpt) Read more at: Deadline
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