Huntsman Under Fire Over $15M Payout To FounderBy Anne UrdaLaw360, New York (March 30, 2009) -- Huntsman Corp. is catching heat for forking over $15 million in consulting fees to founder and chairman Jon Huntsman for his role in helping resolve a lawsuit brought by the chemical company against private equity firm Apollo Management LP over a failed leveraged buyout.The payment was revealed in a footnote in Huntsman's 2008 annual report, suggesting that the chemical company did not want to draw attention to the matter in the midst of public outrage over corporate bonuses.The company defended the payout as a reward for Huntsman's “negotiation of the settlement agreement, and his efforts during 2008 related to the company's litigation with Apollo," according to a securities filing."Jon single-handedly negotiated this settlement and, I believe, saved the company in doing so," said Nolan Archibald, a Huntsman board member and head of its compensation committee, the Wall Street Journal reported.The payout was not a bonus but rather a one-shot performance fee equal to 1.5 percent of the settlement, according to Archibald.A representative for the company could not be reached immediately for comment Monday.Huntsman sued Apollo in June after it abandoned a $6.5 billion takeover deal between Huntsman and Apollo-owned Hexion Specialty Chemicals Inc.The company was originally seeking more than $3 billion in compensatory damages plus unspecified exemplary damages, though Huntsman ended up settling the matter for significantly less.The ill-fated Huntsman-Hexion tie-up was forged in July 2007, just months before the onset of the credit crisis still gripping the economy.In late September, the Delaware Court of Chancery ruled against Apollo and Hexion, refusing to let them out of the agreement. In a crucial opinion, Vice Chancellor Stephen P. Lamb found Huntsman's business did not suffer a material adverse effect that would have cleared the way to terminate the deal.Despite the favorable ruling, Huntsman decided to strike a $1 billion deal with Apollo in December, after concluding that continuing to pursue the litigation would be more costly in the end even if successful.“Receipt of these proceeds will enhance the strength of Huntsman’s balance sheet and better position our company to prosper during the current turbulence in the global economy,” Huntsman President and CEO Peter Huntsman said.The settlement angered shareholders, though, who watched the company's value drop by nearly 50 percent the day the settlement was announced.Huntsman was not the only one to be rewarded for his role in the settlement talks, with litigation counsel Vinson & Elkins reportedly raking in $43 million in fees.The Apollo settlement did not resolve the billion-dollar claims asserted by Huntsman in a Montgomery County, Texas, court against Credit Suisse and Deutsche Bank, however.Huntsman claims the banks conspired with Apollo and tortiously interfered with a prior merger agreement and the Hexion agreement. That case is slated for trial in May.--Additional reporting by Pete Brush