Earlier this month, the U.S. Court of Appeals for the Third Circuit affirmed the decision of the lower court and denied Vernon Hill II, the founder of Commerce Bank, a $17 million “golden parachute.” Hill was terminated in 2007.
He sought payment for severance, interest and stock options, as stated under his employment contract, however, the bank refused to honor the contract. Hill sued the bank for breach of contract, and a jury returned a verdict in favor of the bank.
Hill appealed, arguing that the verdict should be reversed based on several evidentiary issues, but the Third Circuit found no abuse of discretion on those rulings and denied Hill’s motion for a new trial. The court held that the bank was barred from paying because it was in a “troubled condition” that did not allow it to pay severance to executives.