Lawsuits are flying between Dow Chemical and a former executive and board member. The legal face-off started as a spat over body language between CEO Andrew Liveris and Romeo Kreinberg, who ran the chemical and plastics portfolio. Liveris wrote in a review that he didn’t appreciate Kreinberg’s “negative body language,” and threatened to fire Kreinberg if he didn’t stop pretending to shoot himself in the mouth with his finger every time Liveris proposed an initiative. Kreinberg was canned in three weeks, after an especially aggressive display in which he simulated the post-shot, through the head splatter, after Liveris issued a cost-cutting plan in a meeting. Kreinberg also was accused, along with board member J. Pedro Reinhard, of having unauthorized discussions with third parties about the acquisition of the company. The third party - JPMorgan.
Yesterday Kreinberg and Reinhard fired back with a defamation lawsuit against Dow Chemical and Dow Chemical responded by suing both men. It’s the legal equivalent of a John Woo action scene.
How did Liveris find out about the unauthorized talks with JPM? Jamie Dimon told Liveris himself.
The details of the tryst, from the New York Times:
At the Compleat Angler, a luxury hotel overlooking the Thames, the two Dow Chemical officials met with two senior executives of JPMorgan Chase in early February, according to people who attended the meeting.
In addition to Mr. Kreinberg and Mr. Reinhard, the meeting was attended by William Winter, the co-head of investment banking of JPMorgan, and Ian Hannam, a managing director of JPMorgan Cazenove who was the point man on the discussions. The meeting was organized by Terrance J. Ruane, a consultant to Dow Chemical who had helped lead the company’s deal making in Oman.
Kreinberg and Reinhard’s camp maintains that the meeting was a typical interaction between bankers and business execs and that there was no secret plan to buy the company. Dow Chemical’s lawsuit claims the exact opposite, and claims Jamie Dimon personally provided “irrefutable evidence” to the contrary. Dimon even had dinner with Liveris, and may have even paid for it.
Did Dimon get caught playing both sides here? Was Jamie Dimon's hand forced in order to keep in Dow Chemical's good graces (and running advisory fees) when JPMorgan's attempt to win a huge and potentially hostile buyout became more and more unlikely (or discovered)?
Behind the Dow Chemical Firings, a Tangled Corporate Drama [New York Times]