The Justice Department is opposing Bayou Steel BD Holdings’ executive bonus plan, arguing that the bankrupt steelmaker set the bar too low for the payout.
Bayou’s plan to pay bonuses to four executives is based on a “single, easy-to-meet metric” that falls short of the Bankruptcy Code’s requirement, according to an objection filed Nov. 7 by the U.S. Trustee, the DOJ’s bankruptcy watchdog.
The bankruptcy code requires that bankrupt companies’ incentive bonuses should be “tied to significant goals that are difficult to achieve,” said the filing at the U.S. Bankruptcy Court for the District of Delaware.
The LaPlace, La.-based company...