Apple wins lawsuit alleging Tim Cook, other executives of being overpaid

Apple’s overpaid executives: A federal judge on Wednesday dismissed a lawsuit against Apple alleging that Chief Executive Tim Cook and other top executives were overpaid by tens of millions of dollars due to miscalculations in the value of performance-based stock awards.

US District Judge Jennifer Rochon in Manhattan ruled that Apple had accurately disclosed its compensation methods in detailed tables in its 2023 proxy statement, in accordance with securities laws and US Securities and Exchange Commission regulations.

Rochon also found no evidence of improper action by Apple's board of directors in awarding executive pay and noted that the plaintiff, a pension fund affiliated with the International Brotherhood of Teamsters, had not given the board sufficient time to address its concerns before filing the lawsuit.

The plaintiff alleged that Apple had awarded Cook and four other executives $92.7 million and $94 million in performance-based restricted stock units in 2021 and 2022, respectively, while the compensation committee had intended to award only $77.5 million each year. The discrepancy was attributed to an alleged error in the calculation of the RSUs' fair values at the time of the grants, which the plaintiff claimed misled shareholders preparing to vote on executive compensation.

According to Apple's proxy filings, Cook's total compensation amounted to about $99 million in both 2021 and 2022, with over $82 million in stock awards each year. However, his total pay decreased to $63.2 million in 2023. The four other Apple executives received more than $26 million each year over the three-year period.

(With Reuters inputs)