Court says Sarbox needs further defining

A US federal appeals court has said that the Sarbanes-Oxley Act seems to be lacking a definition of “extraordinary payments”.

In ruling whether two former Gemstar-TV Guide international executives (CEO Henry Yuen and CFO Elsie Leung) can claim $37.6 million in severance payments blocked by the SEC, the court said that neither Congress nor the SEC had defined “extraordinary payments”.

Yuen and Leung were originally to have collected severance payments, provided they cooperated with an internal audit investigation and with the SEC over the company’s restated financials.