Nacchio Sues Qwest for Legal Fees
Nacchio's attorneys allege that invoices for legal fees sent to Qwest remain unpaid and that this violates the terms of Nacchio's severance package with the company back in 2002. "The advancement of fees, as required by the employment agreement and the resignation agreement, is essential for plaintiff to protect himself legally," reads the official complaint.
A Qwest spokesman commented late last week that Nacchio's complaint "is without merit and we'll defend ourselves vigorously."
But comments by current CEO Dick Notebaert suggest that Qwest is taking a much more careful approach to the matter. Last week during a stockholders meeting, he commented that the board of directors was carefully examining corporate bylaws of Delaware, where Qwest is incorporated, to determine what the proper course of action would be and to see what their obligations are in lieu of the verdict in Nacchio's insider trading trial.
It is not clear just how much money is being contested in the suit nor how much money Qwest has already paid in legal bills for Nacchio up to this point. Experts estimate that Qwest has paid in the tens of millions already.
That number will only continue to climb higher as Nacchio plans to appeal the guilty verdict on all 19 counts of insider trading that he was convicted on. His sentencing is scheduled for July 27, and each count carries up to 10 years in prison.(See Nacchio Found Guilty.)
Nacchio was found guilty of selling $101 million worth of Qwest stock based on inflated sales forecasts, with many in the company testifying that it was commonly known that the company would not be able to meet its overstated financial forecasts. (See Nacchio Qwoted Qwestionable Qwest Targets.)
Representatives from Qwest could not be reached for comment on this story.
— Raymond McConville, Reporter, Light Reading