Sanctions loom as France probes Viv U
A contract’s a contract. Vivendi Universal’s controversial former CEO Jean-Marie Messier may be down, but he’s not out — of cash, that is. So ruled a New York State court Monday, ordering the French conglom to fork over a 20.5 million euros ($23 million) severance payment.
The payout was agreed upon when Messier was forced out as Viv U chairman-CEO in July 2002. Viv U didn’t pay and the case went to arbitration. In June, a panel ordered Vivendi to honor the contract. The company had filed a motion to vacate the award and lost.
Vivendi said in a statement it “intends to use all legal options in order to oppose a payment to Mr. Messier including appeal and a request to stay enforcement of the judgment pending the appeal.”
A payment would be sure to infuriate Vivendi shareholders and current management who blame Messier’s spending spree and fuzzy accounting for dragging the conglom to the brink of bankruptcy. Such golden parachutes have been slammed for awarding millions of dollars to top execs while shareholders are left holding the bag.
Viv U is in the process of selling Universal to General Electric, unwinding Messier’s expensive foray into the U.S. entertainment biz.
A French court has scheduled its own hearing into the disputed severance package for Oct. 13.
Separately, sources at the Commission des Operations de la Bourse, France’s SEC, said the watchdog is considering sanctioning Viv U after a 15-month probe into its financial disclosures during Messier’s tenure.
Vivendi shares fell 0.85% to $17.55 Monday in New York.