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Goldman Sachs Might Have A Problem Weaseling Out Of Fed Tippee’s Boss’ Legal Bills

There's some belt-tightening at 200 West, so please meet your new counsel Bob Loblaw.
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Deputy CEO for Short-Haul Human Flight

Deputy CEO for Short-Haul Human Flight

The Elect have so far managed to avoid ponying up for poor Sergey Aleynikov’s lawyers, on account of the fact that it and every other bank on Wall Street have so stretched the definition of “vice president” that it is essentially meaningless. Turning it into a title you wouldn’t even blink at if applied to, say, a janitor or cafeteria employee or window-washer at 200 West Street.

But Goldman’s fight to avoid paying the legal fees of former employees it doesn’t like isn’t over: It’s also refusing to front Joseph Jiampietro cash to battle the Federal Reserve, which says he told Rohit Bansal to get the secret sauce from the New York Fed. Goldman might not go quite so far, but it did fire him for not telling his bosses that he’d gotten the documents, and hasn’t paid out a dime to defend him.

This could prove a taller order: First, Jiampietro was an MD, a step above VP, which the courts have said is borderline officer level, and officers get their legal bills paid. Second, there’s the matter of Goldman’s annual reports, the contents of which courts tend to take pretty seriously.

His lawsuit includes pages from Goldman’s annual reports in which his name is listed among the “board members, officers and directors” of the firm, evidence that he was more likely to qualify for payment of his legal fees.

Which is great news for Jiampietro, because if the Fed wins, he’ll never work a seven-figure job in this town again. Unfortunately for Jiampietro, it’s no slam-dunk, because words—even the words “managing director” and “board members, officers and directors”—apparently don’t mean things anymore.

Although his job appears to be closer to what is generally considered to be an officer of a company, the ambiguity in the meaning of that term found by the United States Court of Appeals for the Third Circuit in Mr. Aleynikov’s case gives Goldman a basis to argue that even a managing director is not covered by the provision providing for legal fees, even if the annual reports imply otherwise.

Goldman Sachs’s Fight to Avoid Paying Employees’ Legal Fees [DealBook]


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