A Bankruptcy Judge Stopped Sports Authority Executives From Snagging A $3 Million Bonus For Shutting Down All The Stores
Reuters – A U.S. bankruptcy judge refused on Tuesday to allow Sports Authority to pay up to $2.85 million in bonuses to four executives for overseeing the winding down of the national sporting goods chain.
Englewood, Colorado-based Sports Authority filed for bankruptcy in March with hopes of keeping some of its 464 stores open, but battles among lenders and suppliers eventually scuttled those plans. Its final stores closed last month.
“I think it’s just inappropriate to pay senior executives a bonus when all the employees are losing their jobs,” said Judge Mary Walrath during a hearing in Wilmington, Delaware.
Sports Authority said the bonuses were essential to ensure executives squeeze the most value out of its assets by adhering to a budget and preventing waste.
The company asked to keep the identities of the executives under seal to “minimize detrimental impacts on employee morale,” which prompted an outcry from some of the 14,000 former staffers.
“I’m not surprised the employees are sending angry emails about it,” said Walrath.
Sucks for those four guys who were clearly savvy negotiators but ultimately found themselves held up as an example of corporate greed run amok, very thin line between those two outcomes. And really this is one of those cases where it was just bad luck. You do something ethically questionable like hand yourself bonuses while others suffer, there’s at least a 50% chance you’re skating. But you ask for a few too many dollars, end up with the wrong judge on your case who maybe heard a few too many Bernie Sanders speeches in the primaries, all of a sudden you spent months destroying people’s lives and deconstructing a decades-old business for nothing more than your lucrative base pay. It’s a capitalist tragedy no matter how you slice it.
Also this is kind of awkward:
The NFL champions’ home stadium is currently sponsored by a bankrupt company that no longer exists? Dick’s Sporting Goods bought the intellectual property of Sports Authority but I guess that doesn’t extend to stadium naming deals? That’s probably why they booked Tacolandia, to distract people from the real issues.
UPDATE: In the 10 minutes since this blog has gone up and not a second before the Broncos apparently repurchased the naming rights to their stadium, great job by them and this blog and Tacolandia for making that happen.