Articles Posted in Arbitration

A panel of arbitrators has found that the former chairman and CEO of Gemstar-TV Guide International Inc. breached warranties and representations that he made to the company. The arbitration panel is ordering Henry Yuen to pay $93.6 million in fees, damages, and back pay to Gemstar. According to the panel, Gemstar was within legal bounds to fire Yuen in April 2003, because of his misconduct relating to a corporate and management restructuring that took place in 2002. The panel also decided that Yuen is not entitled to the $39.9 million dollars he says that the company owes him because he was displaced as CEO and chairman due to the restructuring.

The ruling by the arbitration panel has rejected all of Yuen’s wrongful termination-related claims. This includes approximately $6.9 million in attorney’s fees that were given to the former CEO, some $6.1 million in salary paid to the former CEO since he was let go, and, for breaches of warranties and representation, approximately $80.6 million in damages. The panel also decided that it agrees with Gemstar’s claim that the Patent Rights Agreement between Yuen and the company will stay effective until 2010.

The judgment means that Yuen is not allowed to receive any more advancement of legal fees or indemnification for any matters related to his alleged misconduct. The panel also decided that Gemstar has the right to another judgment for costs and attorneys fees. The arbitrators will decide what this amount will be at a future date. In the meantime, Gemstar says it will pursue the amounts awarded to them from Yuen.