## Facts

- Wade Tucker, a HealthSouth shareholder, brought a shareholder-derivative action on behalf of HealthSouth against Richard M. Scrushy, HealthSouth’s former CEO and a director.
- The suit arose from alleged large-scale accounting fraud that overstated HealthSouth’s financial results for years beginning at least in the mid-1990s.
- HealthSouth proxy statements described executive bonuses as payable from a “bonus pool” tied to net income and conditioned on meeting or exceeding budgeted net income.
- After HealthSouth restated its financials, the restatements reflected net losses for relevant years, calling into question whether any bonus pool existed under the disclosed criteria.
- Tucker sought restitution of incentive bonuses paid to Scrushy roughly from 1997 through 2002, alleging Scrushy was unjustly enriched because the bonuses were paid based on false financial performance.
- The derivative case was stayed during related federal criminal proceedings; Scrushy was later acquitted, and the civil case proceeded.
- The trial court entered partial summary judgment ordering Scrushy to repay specified bonuses and certified that judgment as final under Rule 54(b).

## Issues

1. Whether the partial summary judgment ordering restitution of bonuses was properly certified as a final judgment under Rule 54(b), permitting an immediate appeal.
2. Whether summary judgment was proper on a restitution/unjust-enrichment theory requiring Scrushy to repay bonuses allegedly paid contrary to the bonus criteria disclosed in proxy statements as shown by later restated losses.
3. Whether Scrushy’s employment contract independently entitled him to the bonuses regardless of the proxy-statement criteria and restated financial results.
4. Whether equity barred requiring repayment of the gross (pre-tax) bonus amounts.

## Decision

- The Supreme Court of Alabama held the Rule 54(b) certification was proper and proceeded to the merits.
- The court affirmed the partial summary judgment requiring Scrushy to repay the disputed bonuses.
- The court concluded the undisputed evidence supported unjust enrichment because the restatements showed the company lacked the net income required to create the disclosed bonus pool.
- The court rejected arguments that the employment contract guaranteed bonuses outside the proxy-statement framework.
- The court found no genuine issue of material fact that would defeat summary judgment, including as to the bonus Scrushy attributed to earlier performance.
- The court held restitution properly required repayment of the full amounts paid, not a net-of-tax figure.

## Legal Principles

- A Rule 54(b) certification is permissible when the adjudicated claim is sufficiently separate to be treated as final for appeal, even if other claims remain pending.
- Unjust enrichment permits restitution where retention of a benefit conferred at the corporation’s expense would be unconscionable under the governing equitable standards.
- When executive bonuses are conditioned by disclosed criteria tied to corporate net income, later-established absence of the required net income can support restitution of bonuses paid under contrary financial reporting.
- An employment agreement does not defeat restitution when it does not establish an independent, unconditional entitlement to bonuses outside the disclosed bonus-plan conditions.
- In restitution for improperly paid compensation, the measure may be the corporation’s loss (the full amount paid), not the recipient’s after-tax gain.

## Conclusion

The court allowed immediate appellate review under Rule 54(b) and affirmed summary judgment requiring Scrushy to disgorge bonuses, holding that restated losses negated the disclosed net-income-based bonus prerequisites and that equity required repayment of the full amounts paid.


Scrushy v. Tucker, 955 So. 2d 988 (Ala. 2006)