You might think that Valeant Pharmaceutical shares are more likely lose Bill Ackman another $2 billion than recoup any of its remaining investors their own losses. That they are more likely to fall another 90% than rise appreciably in the near future. That they are essentially worthless.
And so they are—unless you are Michael Pearson. The serial acquirer’s architect, Pearson left the company mid-freefall after Ackman suggested that he probably shouldn’t be CEO anymore, before quickly retracting it and letting Pearson remain CEO for another few, disastrous months. Valeant gave Pearson $9 million to go away. But, according to Pearson, it did not also give him the 3 million shares and $180,000 in consulting fees it also promised. And now he wants them.
In a lawsuit filed Monday in the U.S. District Court of New Jersey, Mr. Pearson said Valeant breached his contract by not paying him 580,676 shares and 2.5 million performance shares that were due last November under the terms of his separation agreement.
Valeant isn't exactly disputing that, but does have two things to say about it: One, Pearson kinda sorta doesn’t deserve anything more than the $72 million it paid him last year, and, two, it’s sort of in a bad place right now.
A spokeswoman for Valeant declined to comment Monday. Last week, the spokeswoman said the company had “determined not to make further payments due to the circumstances that Valeant finds itself in at this time.”