MSG shareholders suing New York Knicks owner James Dolan for 'excessive' pay.
A shareholder has sued Madison Square Garden Company CEO James Dolan, claiming that the New York Knicks owner is overpaid and that he spends more time with his band JD & the Straight Shot than actually being an executive.
According to filings by MSG, Dolan has been paid almost $76 million over the past three years, with the lawsuit saying that the MSG's peer companies paid their CEOs an average of $17 million over the same time frame.
“The single plaintiff in this suit -- Shelby Willcox and the Norton C. Willcox Testamentary Trust – was found by a firm, Purcell Julie & Lefkowitz LLP, that sends out press releases fishing for clients," a statement from the team said. "Under Jim’s leadership, MSG has generated tremendous shareholder value, including a stock price return of nearly 40%, equivalent to a $2 billion increase in market cap, since he became CEO in November 2017. A substantial portion of Jim’s compensation are options that are priced at a significant premium – creating additional incentive for him to continue growing the company and creating value for shareholders.”
MSG, which also owns the New York Rangers of the National Hockey League and Radio City Music Hall among other entities, vowed to fight the lawsuit.
"This lawsuit amounts to nothing more than corporate harassment. The company stands by its policies and practices," MSG said in a statement to Agenda, which first reported the lawsuit. "These [law] firms represent the worst in our legal system," the statement read. "They manufacture complaints and then advertise for clients, also known as trolling. Members of these firms tried to the same tactic at Cablevision [where Dolan previously served as CEO]. They lost and will lose again."
The lawsuit also took issue with Dolan performing with his band.
“In 2017, for example, the band performed 50 times in six countries and 41 U.S. cities, an increase from the 32 shows it performed in 2016. In late 2017, the band released its sixth album, and is in the process of recording a seventh," the lawsuit said.
According to Forbes, the Knicks are the highest valued NBA team at $4 billion, up 11% from last year.