Swartz v. Tyco Intl. Ltd.

U.S. DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Employment

New York Law Journal

   |0 Comments

Judge Thomas Griesa

Swartz resigned from Tyco in 2002. His May 2012 suit sought money allegedly owed, but never paid, under a 1999 Executive Retirement Agreement (ERA) and a 2002 Supplemental Executive Retirement Program (SERP) agreement. He claimed the ERA entitled him to a $47 million payout of deferred compensation. His SERP claims concerned $9 million related to taxes. The court dismissed Swartz's claims on the ERA, the SERP and 401(k). Tyco's 2003 suit against Swartz seeking disgorgement of all compensation and benefits put at issue Tyco's obligation to pay him thereunder. By at least 2004 Swartz knew that Tyco rejected his payment claims. Thus Swartz's claims relating to the ERA, SERP and 401(k) were compulsory counterclaims that should have been brought in the Tyco action. However, the court denied Tyco dismissal of Swartz's contract breach action arising from its alleged failure to reimburse New York State and City tax payments. Tyco's reimbursement obligation had not accrued when Swartz answered Tyco's complaint in 2004 because Swartz had not yet paid those taxes and did not know what amount would ultimately be paid. Thus, in September 2004, Swartz had no claim for reimbursement to bring as a counterclaim in the Tyco action.

What's being said

Comments are not moderated. To report offensive comments, click here.

Preparing comment abuse report for Article# 1202577118950

Thank you!

This article's comments will be reviewed.