Legal Accountability - Bringing the Self-Righteous, Negligent Corporate Officers in Line
May 15, 2008
– Comments (5)
Yippie...
This one is saying the executives of Countrywide must face a lawsuit to go after their wealth for their negligence.
“As institutional investors, it is our duty to seek recourse when a company’s directors engage in practices that are not in the best interests of shareholders,” said Christa S. Clark, chief legal counsel of the Arkansas Teacher Retirement System, the lead plaintiff in the case. “We are pleased with the court’s ruling as it enables the shareholders to move forward with our case and remedy this wrong.”
The plaintiffs in the case said they hoped to recover money for shareholders from Countrywide officials named in the case who sold $850 million in stock from 2004 to 2007. The plaintiffs contend that the directors and officers dumped shares even as the company spent $2.4 billion to repurchase its own stock in late 2006 and early 2007.
The chief executive of Countrywide, Angelo R. Mozilo, has argued that his $474 million in stock sales during the three-year period complied with securities laws under a planned selling program. But he revised the program, known as a 10b5-1 plan, several times, each time increasing the shares to be sold.
As a result, the judge wrote: “Mozilo’s actions appear to defeat the very purpose of 10b5-1 plans,” created to allow corporate insiders to sell stock regularly and without direct involvement.
I simply do not see any defense of the Countrywide directors over what happened and what they did. They clearly destroyed a company and investor wealth for personal gain, imho.
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