Spine device maker Orthofix Medical has paid about $24 million to three former executives following legal disputes over their 2023 terminations, according to an Oct. 12 CFO Dive report.
The payments stem from breach of contract claims filed by former CEO Keith Valentine, CFO the late John Bostjancic and Chief Legal Officer Patrick Keran. Orthofix fired the executives Sept. 11, 2023, citing inappropriate and offensive conduct.
Orthofix paid Mr. Valentine $14.8 million in April for severance, equity-based rights and accrued interest. An arbitrator awarded him an additional $1.1 million in attorney fees, costs and expenses in June. The company also paid Mr. Bostjancic and Mr. Keran $4.25 million each through settlements during the second quarter.
The arbitration decision centered on the timing of inappropriate text messages exchanged before the executives signed severance agreements June 19, 2023. The arbitrator found that messages predating the agreements could not establish grounds for termination under those contracts. However, the arbitrator denied Mr. Valentine’s defamation claims and found that his conduct met the legal definition of acts of moral turpitude.
Litigation remains ongoing. Mr. Keran is pursuing separate claims against former Board Chair Cathy Burzik and current Director Wayne Burris in California state court. Orthofix disputes the allegations and said it will continue defending against them.
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