Yuen Ordered to Pay Gemstar $94 Million

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An arbitration panel has ordered former Gemstar-TV Guide International Inc. Chief Executive Henry C. Yuen to pay the company $93.6 million in damages, salary and other costs.


The panel also ruled that Yuen is not entitled to collect $30.9 million in salary and benefits that have been frozen since the executive was fired in 2003 amid charges that he and other executives inflated the company’s revenues to meet financial targets.


Yuen, who was also chairman of the Los Angeles entertainment company, argued that he was wrongfully terminated and was entitled to the funds under his employment contract.


However, arbitrators concluded Monday that Yuen breached his employment contract and awarded Gemstar $80.6 million in damages and $6.1 million in salary paid to Yuen since he was fired, as well as $7 million in attorneys’ fees and costs.


“We are very pleased with the arbitrators’ ruling in this matter,” said Stephen Kay, Gemstar’s executive vice president and general counsel. “In addition, it is gratifying that Mr. Yuen has been held accountable for a sizable portion of the harm that he caused the company and its shareholders during his tenure as chairman and chief executive officer.”


The judgment follows $22.3 million in fines and penalties Yuen was ordered to pay last year by a federal judge in a lawsuit filed by the Securities and Exchange Commission. Yuen was found to have inflated the company’s revenue by nearly $250 million in an effort to boost its stock. The judge also found Yuen liable for misrepresenting facts to Gemstar’s auditors and falsifying the company’s books.


Shares in Gemstar were up 23 cents to $3.88 in midday trading Tuesday.

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