Aryzta, the owner of the Cuisine de France and other bakery brands, has asked the High Court to strike out challenges by four former executives to the way the company arrived at the decision that they were not entitled to performance related shares.
The four former executives have claimed specific performance of entitlements in accordance with the termination agreements they entered into in 2020. They are also claiming damages.
Aryzta Technology Ireland Unlimited Co, and its Swiss parent Aryzta AG, have asked the High Court to refuse to deal with their actions, or halt them, on the basis that there are already mirror proceedings in Switzerland which the firms say is the correct jurisdiction for the cases.
The former CEO of the Irish company, Kevin Toland, former chief executive for Europe, Gregory Sklikas, chief people officer Anthony Murphy, and one-time chief commercial officer of Aryzta North America, John Heffernan, oppose the application and say the cases should be dealt with in Ireland.
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The court heard the dispute centres on the interpretation of rules on executive compensation through the system for issuing shares.
The executives had an entitlement to what are called performance share units which are vested and converted into shares in accordance with the company’s long term incentive plan to incentivise employees to perform.
This “vesting” is determined by a remuneration committee of the board of the parent (Swiss) company in accordance with certain rules and based on the economic performance of the company during the tenure of executives.
Aryzta says the fixing of the vesting multiple at zero for determining the former executives’ share allocation was taken on foot of poor economic performance during their employment.
The four claim Aryzta has gerrymandered the rules to deny them their entitlements which were preserved by the termination agreements. It is claimed the application of a vesting multiple of zero for them was discriminatory compared to how it was applied to others in the company.
The claims are denied.
On Friday, Eoin McCullough SC, for the Aryzta firms, asked that the claims be struck out or stayed pending a decision by the Swiss court.
Mr McCullough said Aryzta was the first to bring proceedings over the matter, in Switzerland, after the company received a letter in January 2024 from Mr Toland’s lawyers challenging the board’s vesting decision.
On April 10th, 2024, Aryzta issued proceedings with the Conciliation Authority in Switzerland to determine whether it had any liability for the manner in which it exercised its functions under Swiss law.
Less than a week later, the four men issued their proceedings in the Irish High Court.
Mr McCullough also said that while Mr Toland had previously issued similar proceedings in Ireland, they were never served or proceeded with and were superseded by the new proceedings.
Counsel said the issue of which jurisdiction should hear the case was covered by the Lugano Convention which provides that the court where the proceedings were first in time, or “first seized”, is where the cases should be heard.
Aryzta also claims the case has nothing to do with their employment contracts or termination agreements because it relates entirely to the rules governing the incentive scheme and the exercise of the powers of the Swiss parent board.
Cathy Smith SC, for the four former executives, said it was their position that the proceedings in Ireland are not the same as in Switzerland although they are related.
These were proceedings involving an Irish employer and they related to loss of benefits under the termination agreement, she said. Ireland was where they should be dealt with, she said.
Mr Justice Liam Kennedy reserved judgment.
