Finally, some good news for Richard A. Grasso.
In a decision yesterday that raises the legal hopes of Mr. Grasso, the former chairman of the New York Stock Exchange, a New York appeals court dismissed four of six legal claims brought against him over his compensation. The ruling may make it more difficult for the state to get Mr. Grasso to return a large portion of his $190 million pay package for his eight years as the exchange chairman.
Among the claims dismissed was a crucial one brought by Eliot Spitzer, then the attorney general for New York, which argued that Mr. Grasso’s pay was unreasonable under New York State’s nonprofit law. Now, lawyers for the attorney general will have to prove in court that Mr. Grasso knew or should have known that his pay was unreasonable.
The five-judge panel, which voted 3 to 2, did not address last year’s decision by Justice Charles E. Ramos of State Supreme Court in Manhattan that Mr. Grasso must return as much as $100 million of his pay. But the fact that the panel is raising questions about the attorney general’s authority to try several crucial portions of the case is sure to be seen as a positive development by Mr. Grasso and his lawyers.
The dismissal of a claim that Mr. Grasso received an illegal loan will almost certainly decrease the amount that he is being asked to repay.
“These four causes of action are not within the scope of the attorney general’s authority,” the majority opinion said.