Legal News

Harvard?s Lucian Bebchuk: A Boldfaced Name in the Yahoo/Icahn Spat

By Dan Slater

This morning, the Law Blog enjoyed Andrew Ross Sorkin’s DealBook column in the NYT, which contained tale of a dinner that Sorkin shared recently with Carl Icahn. The two ate at a fancy Chinese restaurant in Manhattan, Icahn ordered a martini — before he sat down — and then complained to Sorkin about “entrenched boards” while he slurped from a bowl of shark fin soup.

Then this: Sorkin reprised the news, first out last week, that Icahn, who’s currently mounting a proxy contest to oust the board members of Yahoo, has proposed inserting as a new board member, among others, Lucian Bebchuk.

We were remiss last week, but let’s give you a quick backgrounder on Bebchuk, the Harvard-law-professor-cum-shareholder activist, who wrote “Pay Without Performance,” a 2004 book that slammed executive comp and called for a new system of corporate pay that is more closely tied to performance. Bebchuk’s proposals have had some success. In 2007, after Robert Nardelli resigned as CEO of an embattled Home Depot — taking with him an exit package valued at about $210 million — the company adopted a bylaw, submitted by Bebchuk, that required approval of executive comp by at least two-thirds of the board’s independent directors, rather than a mere majority of the directors on the compensation committee.

Bebchuk has also agitated at other companies, such as AIG, Disney and Exxon.

Full post as published by Law Blog - WSJ.com on May 20, 2008 (boomark / email).