Clifford Chance

Want it all and be left empty-handed: a director's claim for statutory remuneration pursued in bad faith (Euro Mall Praha)

9 April 2018

In a key ruling affecting mergers and acquisitions, but also other important areas of Czech corporate practice, the Supreme Court of the Czech Republic has removed a thorn from the side of many target companies and their acquirers in relation to an all-too-familiar "skeleton in the target company's closet" – potential claims by former directors for statute-based "usual" remuneration. In its judgment no. 29 Cdo 1866/2016 from August 2017, the Supreme Court rejected a claim for "usual" remuneration brought by a former board chairman on the grounds that, under the circumstances of the case, the claim was pursued in bad faith.

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