DoJ Calls Bankrupt Sports Authority Executive Bonuses ‘Unseemly’

The DoJ’s bankruptcy trustee is not thrilled with a proposal from Sports Authority to offer their executive team $1.5 million in bonus pay. According to reports, that bonus plan has raised many hackles of late — lenders, landlords, and the presiding judge all balked at the plan, which was temporarily stayed by the court.

One of the three executives slated for a bonus has already quit the firm — Sports Authority has argued that the bonuses are a necessary means of ensuring essential staff stay onboard to wind down the athletic retailer. Moreover — the bankrupt retailer notes that the executives slated for the “unseemly bonuses” (the DoJ’s description, not ours) are deserving as winding down corporate operations is hard work.

Federal bankruptcy watchdog Andrew Vara and his legal team don’t quite see the issue the same way, noting that lots of people who deserve to get paid — like creditors — won’t be getting paid. Moreover, Vara and team doubt very seriously that the bonuses are truly necessary to keep staff on sight — tasks either won’t get done, or they will fall to others.

Sports Authority’s trip through Chapter 11 has been highlighted with fireworks so far — 160 lawsuits were filed against it in March over $85 million worth of winter gear and other goods being sold at Sports Authority stores. Since suppliers weren’t sure they were getting paid for that gear, they wanted it back.