Lotus sues former CEO Dany Bahar, aims to recover $4 million

Article by Christian A., on December 3, 2012

Group Lotus claims that the luxurious lifestyle of ousted CEO Dany Bahar was paid for by the British carmaker. Bahar was fired last June. Among the items cited by Group Lotus are expenses for chauffeur, helicopter travel and as many as 10 wristwatches. Lotus hopes to recover around 2.5 million pounds ($4 million) for the unauthorized expenses and overpaid salary and bonuses, according to the court filing last October over Bahar’s exit.

Lotus made this claim in its response to the 6.7-million-pound wrongful dismissal lawsuit filed by Bahar against Lotus and Malaysian parent company DRB- Hicom. DRB, which is controlled by billionaire Syed Mokhtar Al-Bukhary, acquired control of the struggling British sports-car maker via its purchase of Proton Holdings in January.

When Bahar was interviewed last year, he said that Lotus has yet to make a profit since Proton acquired it in 1996 as the producer of the Elise sports car faced hurdles in going up against Porsche and Ferrari in Europe. The Lotus counterclaim states that the Proton board believed that Bahar’s job as CEO was “abysmal.” It also described Bahar as extremely extravagant and mercenary as well as only concerned about his own interests.

The counterclaim also stated that Bahar’s expenses were even more unacceptable since he failed to accomplish his task of turning the business around. The legal dispute revealed the circumstances behind Bahar's bitter departure from Lotus after he was appointed in 2009 to revive the U.K.-based company. Bahar’s lawyers have declined to comment on the matter.

In the court documents filed in August, Bahar said that what Lotus alleges are "ill-founded and unjustified." Bahar said that DRB terminated several managers on groundless claims of gross misconduct so that it can avoid its contractual promise to pay them when the Lotus unit is sold.

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