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by Ann Oldfather, OLDFATHER LAW FIRM
As counsel for Kathleen Smith, we have told the UofL Trustees and the Foundation
Board of Directors that there are material errors and omissions in the Alvarez &
Marsal “Information.” The records of both boards clearly establish that there was no
“secret” deferred comp plan, and no “secret” salaries. What they call “disturbing”
today was their directive at the time.
Instead of welcoming that transparency, the Foundation Board told Kathleen Smith
late yesterday that her “current salary and benefits will cease effective June 22,
This is a breach of Kathleen’s contract with the Foundation, but worse it is a
cowardly failure to stand behind fully transparent salary and compensation
decisions that would never be questioned were she one of the highly-compensated
men on the these boards.
Kathleen never set her own salary, and she never let that salary limit the tasks she
was willing to take on for UofL and the Foundation. That salary from all sources,
never exceeded $300,000. Was she worth it?
In 2007, the Foundation Board, not Kathleen, included her in the Foundation’s
Deferred Comp Plan with an award of $12,500 for each year of service. In recent
years, four additional grants of $100,000 were made. With the inclusion of deferred
bonuses (total $77,205) and a one-time $50,000 grant, her total contributions
spanning forty-six years of service were $1,093,062. Did she deserve that?
Foundation Board directors and their lawyers decided the terms of the Foundation’s
Deferred Comp Plan, not Kathleen. The Directors required gross-up for taxes for
ALL members in the Plan, and when awards vested without liquidation, the Plan
required interest paid on ALL accrued earnings—not just for Kathleen. Is any of
that wrong-doing by her?
Look around this University and answer those questions. Consider the more than
$235,000,000 in gifts and grants she brought to this University. Consider forty-six
years of service to four UofL presidents. One thing is clear, many men are paid far
more for far less. Many members of these Boards, whose work has been for private
rather than public good, have benefitted far beyond the compensation earned by
this phenomenally hard-working woman. There is no way it was a crime, or a
breach of duty, to pay Kathleen what she was promised and what she so clearly
But now they need a “fall girl” with almost $2 million paid for the “you can’t rely on
this” Alvarez & Marsal “Information,” and Kathleen, who never had a vote on any
Foundation decision, is it.
We will speak for Kathleen and a fully-informed jury can decide if she was worth it.