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Sears' CEO agrees to $40 million settlement of lawsuit that alleged he unfairly enriched himself with the company's 'crown-jewel assets'

The suit targets a real-estate investment trust called Seritage Growth Properties, which Lampert created in 2015.

Sears CEO Eddie Lampert and the company's board of directors agreed to a $40 million settlement of a shareholder lawsuit that alleged Lampert had stripped the company of its best assets to benefit himself and his hedge fund. 
After launching Seritage, Lampert orchestrated a big real-estate deal. Sears sold 235 stores, including many of its most profitable locations, to Seritage in 2015. Sears raised $2.7 billion from the sale and rented back the store space from Seritage.
The deal provided struggling a Sears with much-needed cash at the time, and gave Seritage the right to take over all or half of the square footage of many stores and then rent the empty space to other retailers at sometimes four times the rent. The lawsuit said that the Sears stores were worth far more than $2.7 billion and that Lampert — by standing on both sides of the transaction — stood to benefit regardless. Seritage and Sears are separate entities, but Lampert, as chairman of Seritage and CEO and chairman of Sears, has a significant stake in both. Lampert and his hedge fund, ESL Investments, own a little more than 43% of Seritage's limited partnership. They also own a little more than 54% of Sears Holdings.
"Eddie Lampert used his position at Sears as its CEO and controlling shareholder to further his and his hedge fund's interests rather than the best interests of the company [by spinning off its] crown-jewel assets to the REIT at an unfair price," Ned Weinberger, a partner at the law firm Labaton Sucharow LLP, which is representing the shareholders, told Business Insider in a previous interview.
SEE FULL ARTICLE HERE: http://www.businessinsider.com/sears-ceo-will-pay-40-million-to-settle-shareholder-lawsuit-2017-2