As always, and as I have been blogging on for a couple months now, there are a few key matters that executive compensation professionals and Compensation Committees need to address by year end in 2012. And, as always, Winston & Strawn is hosting a webcast on these items next week. In the future, executive compensation professionals may look back on 2012 as the year that litigation first became a major factor in our area of specialty. The Say on Pay Lawsuits filed last year seem to start an avalanche of class action and shareholder derivative lawsuits putting every public company at risk of being a target.
The most recent wave of lawsuits (described in my October 26 blog, "Class Action Lawyers Achieve a Victory in Executive Compensation Litigation - and Seek to Duplicate the Result Against Other Companies During Proxy Season") challenge the adequacy of the company's disclosure related to executive compensation in its proxy statement and seek to enjoin the annual shareholder meeting. This is a variation on the traditional public company merger litigation that we have defended for decades. More than 20 of these suits have been filed this year alone. Several have actually been successful in enjoining the annual meeting and many more have resulted in enhanced disclosure settlements and a pay-off of attorneys' fees.