Ex-Skandia boss spared 300 million bill

The former CEO of Swedish insurance company Skandia, Lars-Eric Petersson, has been told he does not have to pay damages to his old company. The company had demanded 300 million kronor from its former chief.

The decision was reached by a committee appointed by the parties in the case.

“This is a complete success. Skandia’s case has been dismissed,” said Petersson’s lawyer, Christer Brantheim.

“The committee ruled decisively that Lars-Eric Petersson has not done anything wrong,” he added.

Skandia took Petersson to court in 2004 for his handling of the very high bonuses paid out by Skandia around the turn of the millennium, and he was sentenced this spring to two years in jail. Petersson has lodged an appeal against the verdict.

In Friday’s decision the committee, composed of two judges and a lawyer, discussed whether he had caused financial damage to Skandia.

The committee was unanimous in its judgment, according to a statement from law firm Södermark. The committee’s findings were handed on Friday to the Svea Court of Appeal as evidence that the district court’s verdict and sentence should be overturned.

“I am happy and relieved that the truth has finally come out,” Petersson said in a written statement.

Skandia had sued Petersson for 300 million kronor. Skandia’s profits and share price shot up around the year 2000 and Petersson was praised by the company’s shareholders. But many executives in the company’s US and British subsidiaries demanded more money and were granted it.

Petersson himself was not paid out of the Weatherbuilder bonus programme, but he was convicted earlier this year of bypassing the company’s board and removing the programme’s ceiling. The move cost Skandia 156 million kronor, according to the verdict from Stockholm district court.

Skandia sued Petersson for 300 million kronor in 2004. In order to avoid long and time-consuming court cases the parties agreed that the case would be considered by a committee consisting of a Skandia-appointed lawyer, one appointed by Petersson and one further member. The committee’s negotiations have been held in secret and the result was not open to appeal.