A global biotechnology group part-owned by a New Zealand forestry biotech company must pay $81 million in compensation and damages after a US court found it used trickery and deceit to defraud workers out of a lucrative incentive package.
Nine former employees of seedlings company ArborGen were tricked into accepting a revised long-term incentive plan that cut their combined compensation package by around 90 per cent after the company began to grow, a South Carolina lower court judge found.
The lawsuit filed in 2010 against ArborGen, part-owned by Auckland-based NZX-listed forestry biotech company Rubicon, alleged that company board members used "deception, misplaced trust and pressure tactics" to convince employees to join the less valuable incentive plan.
In a judgment released late last month, Judge Edgar Dickson said ArborGen's "legacy employees reposed special trust and confidence" in the defendants -- which included the company itself, several board members, International Paper, MeadWestvaco (now WestRock) and Rubicon.
In turn, the workers were "abused by ArborGen, its founders, its board members and its management team", the judgment said.