Former Valeant CEO Michael Pearson Sues Company Over Unpaid Share Award
Former Valeant Pharmaceuticals CEO Michael Pearson filed a lawsuit in the US claiming that the company failed to deliver 3 million shares promised to him as part of an exit package. According to the complaint, filed in district court in New Jersey, "despite...Pearson's attempts to resolve this dispute outside of the courts...Valeant has refused to deliver the shares and to meet certain of its other remaining obligations."
In March last year, Valeant announced that Pearson would be stepping down from his position, amid a number of controversies at the drugmaker. Valeant later disclosed that Pearson would receive more than $10 million in severance pay and consulting fees, as well as being eligible for bonuses tied to the company's 2016 performance prior to his departure.
Pearson's lawsuit claims that Valeant promised him 580 676 restricted shares and around 2.5 million performance shares that were due last November, which based on the drugmaker's closing share price on March 27 would have a market value of about $33 million. A spokesman for Valeant declined to comment on the case, although they recently said that the company had "determined not to make further payments due to the circumstances that Valeant finds itself in at this time."
In November last year, US federal prosecutors disclosed charges against two executives, including Gary Tanner, a former manager at Valeant, and former CEO of specialty pharmacy Philidor Rx Services, for engaging in a multimillion-dollar fraud and kickback scheme. Sources had previously suggested that Pearson and Valeant's former chief financial officer Howard Schiller are under investigation by US prosecutors for potential accounting fraud, possibly in relation to Valeant's former relationship with Philidor.
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