Yahoo latest news reveals that Henrique de Castro, former Chief Operating Officer of Yahoo, is right in the middle of a controversy within the company. He was apparently paid US $60 million in severance, according to a ruling of a Delaware judge last Tuesday.
As a result, the current chief executive of Yahoo, Marissa Mayer, together with its board members, is being charged with mishandling the former COO's compensation. The judge's ruling paved the way for an investigation by the company's shareholders.
The initial ruling came from de Castro's 14-month stay as Yahoo COO after Mayer lured him away from his employment at Google.
de Castro started working at Yahoo on Oct. 15, 2012, and pocketed $39.2 million in his first year. That big annual income made him number eight among the highest paid executives in Silicon Valley.
But Mayer fired him on Jan. 12, 2014 for failing to increase Yahoo's revenues through the expansion of its digital advertising. de Castro's dismissal, however, cost the company $59.96 million in severance pay, said the court ruling.
In its effort to get access to the documents related to de Castro's dismissal, Amalgamated Bank sued for access in March, 2015. The bank did this to assess if it is wise to pursue a lawsuit by shareholders against the board of Yahoo for allegedly mishandling de Castro's employment terms.
In a related development, Yahoo is about to lay off around 1,700 employees and is cutting off some of the company's excess baggage in a bid to determine whether Mayer, current CEO, will be able to save her job.
The purge was announced yesterday. It will slash around 15 percent of the search giant's labor force, together with several services that Mayer thought are not worth the effort and money that the company is putting in them.
