Kenneth R. Vaught v. Green Bankshares, Inc., et al.

This appeal arises from an effort by a former bank employee to collect certain deferred compensation payments. Kenneth R. Vaught ("Vaught") filed a complaint against his former employer, Green Bankshares, Inc., and its wholly owned subsidiary, Greenbank ("Greenbank"), in the Chancery Court for Knox County ("the Trial Court"). Both sides agree Vaught is entitled to certain deferred compensation. The issue is the amount. According to Greenbank, Federal Deposit Insurance Corporation ("FDIC") and Troubled Asset Relief Program ("TARP") regulations prevent payment of the total amount requested by Vaught as it would constitute a prohibited "golden parachute." After a trial, the Trial Court found in favor of Vaught, awarding him the full amount. Greenbank appeals. On appeal, FDIC, amicus curiae, argues that the additional deferred compensation payment to Vaught constitutes a prohibited golden parachute. We hold that the Trial Court‘s judgment places Greenbank in the untenable position of having to either disobey the Trial Court‘s judgment or flout federal regulations and FDIC. We vacate the judgment of the Trial Court, remand this case to the Trial Court, and order a 60 day stay, during which time Vaught may pursue, should he elect to do so, other avenues of relief, including via the Administrative Procedure Act ("the APA") to challenge FDIC‘s determination.