Editorial: Courts bring no justice for Furniture Brands executives
The wealthy have nothing to fear from this nation’s courts, and the average citizen has nothing but an uphill climb to get justice.
That is a long-held belief in this country, and Judge Christopher S. Sontchi of the U.S. Bankruptcy Court in Delaware did nothing but reinforce it Friday when he overruled objections to the plan to pay bonuses to seven top executives of Furniture Brands International if the company reaches certain benchmarks when it exits bankruptcy protection in December.
The arguments by U.S. bankruptcy trustee Roberta DeAngelis and industry analyst Budd Bugatch against the bonuses could not have been clearer or, to our eyes, more persuasive.
First: Bonuses should reward exceptional effort. As we stated in an earlier editorial and as DeAngelis and Buggatch argued independently, the bonus plan feels like a rigged game, with the bar set so low that it would take true effort not to make the goals, rather than serious effort being needed to achieve them.
Second: While Furniture Brands said in its motion asking for the bonuses that the bankruptcy filing will require increased work for its top executives, DeAngelis pointed out that the bankruptcy code explicitly states that because increased work is required in virtually all such cases, bonuses must be justified by something more than that. Do we need to add anything here?
Third, but perhaps most to the point for the rank and file at Furniture Brands: The group to be rewarded is the same crew who consistently rewarded themselves while making bad call after bad call after bad call after bad call after … on and on, setting the bar for themselves lower and lower until they finally qualified for bonuses after the $40 million loss of 2012, the sixth straight year of losses. This group of feckless losers has been rewarded more than enough already for bringing the company to bankruptcy. That they should be rewarded for sticking around a few months (for the company’s benefit?) is farcical bordering on tragic.
These soft-fleshed, wine-fattened, cheese-stuffed incompetents should not be showered with bonuses. They should be shackled together and force-marched from factory to factory, showered with rotten produce and spittle the entire way, pummeled with gravel, flayed and made to run from hungry dogs.
That is a visceral reaction and would be inhumane punishment. Our court system exists to impose rigor, structure and a humane and civilized order on top of our animal sense of vengeance and retribution. The most basic reason for any justice system is that if you as an aggrieved individual will forgo the pursuit of watching your nemesis bleed, suffer and beg for mercy at your feet, you are at least assured of impartial, even-handed treatment, that none will be favored, and that those with more money and influence will get no more consideration than you.
It is orders such as Friday’s that do violence to that premise and stoke the belief that the system is broken, if it ever functioned.
What honest person can say that Furniture Brands is better off with those seven executives in place than without them? How many tens of millions of dollars do you need to lose before you are judged thoroughly incompetent and unfit for the job? How many tens of millions do you need to lose before you at least are judged unworthy of a bonus?
Apparently at least a few million more than Furniture Brands has lost in the past six-plus years. In the past two years alone, this group of executives is approaching $100 million in company losses.
And yet the seven executives now know that, barring a disaster, they will reap a combined $3.5 million come December.
Those past and current employees waiting for payments from their pension fund, which the executives shorted to the tune of $200 million? They have no assurance of anything.
Withholding the executives' bonuses and directing that money to the pension fund would scarcely dent the shortfall. But it would be a start.
In this case, on this day, there is no justice.