Dick Grasso won a major victory yesterday in his four-year legal battle over his $190 million pay package, setting the stage for the former New York Stock Exchange boss to enter into settlement discussions with New York State Attorney General Andrew Cuomo.
Grasso and his defense team kept their gloating to a minimum – at least publicly yesterday, after the ruling by New York’s highest court that could kill the bothersome case, and the silence is being seen by experts as an indication Grasso might be maneuvering toward a settlement.
The New York Court of Appeals tossed out four of the state’s six charges over the $190 million compensation package, saying the attorney general’s office has exceeded its authority in pursuing those claims.
State law requires evidence supporting that Grasso knew the payment was unlawful or that he exercised bad faith, according to the court’s unanimous decision.
The two claims that remain against the former stock exchange boss, alleging unlawful transfer of NYSE assets and breach of fiduciary duty, could make it to trial, but they face a higher burden of proof.
Indeed, by not gloating or publicly embarrassing Cuomo, Grasso and his team are sending a signal that they’re open to a deal that could allow both parties to walk away with some dignity, people say.
“Grasso’s team is doing what they should in terms of tactics and enjoying it privately behind closed doors,” said Anthony Sabino, a law professor at St. John’s University.
A person close to Grasso’s team who asked not to be identified disputed the suggestion that the team is operating under gag orders so as not to upset Cuomo, but con ceded they are open to settlement talks and that the ball is now in Cuo mo’s court.
Cuomo’s office didn’t return calls for comment, nor did Gerson Zweifach, who represents Grasso.
Mark Zauderer, another lawyer for Grasso, declined to comment, and said Grasso would not likely comment.
The high court’s ruling could also provide Cuomo with an easy exit from this embarrassing symbol of the Eliot Spitzer era, Cuomo’s predecessor-turned- disgraced-ex-governor, who brought the original charges against Grasso four years ago.
Cuomo could save face by demanding Grasso give back some of the funds – even just a token amount – in exchange for letting him off, observers said.
It’s currently unclear how much of Grasso’s disputed pay is left or how it’s been invested. The state can require targets of legal fights to put monies aside, but it rarely invokes that right.