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Miller Files Lawsuit against Ahold

COLUMBIA, MD - James L. Miller, the former chairman and ceo of U.S. Foodservice Inc., is suing the company for $10 million in damages, saying the company threatened to terminate a generous package of benefits, from medical coverage for his ex-wife to access to the company airplane, according to the lawsuit, reported The Washington Post.

Miller left the company in May 2003 after the Dutch owner, Royal Ahold NV, discovered a series of accounting irregularities there that company officials said led the retailer to overstate profits by more than $1.1 billion.

Miller insists he had nothing to do with the accounting problems and, according to the lawsuit, agreed to resign only after obtaining assurances from senior Ahold executives that, despite the scandal, the company would provide the severance benefits outlined in his contract.

Miller, who started at the second largest distributorship in the United States in 1983, is seeking to force Ahold to pay for life insurance, disability insurance, pension payments, company contributions to his 401(k) plan and back pay for unused vacation, his lawyers said. He also is asking for the financial equivalent of fringe benefits detailed in his contract. These include post-employment access to the company plane and, for three years after his departure, a commitment to pay for dues at up to two local country clubs and the cost of maintaining a company car, records show.

According to this contract, The Washington Post reported, Ahold promised Miller what it calls "administrative assistance" after he left the company, to carry out personal business, including banking, phone calls, letter writing and the scheduling of personal appointments.

Fritz Schmuhl, an Ahold spokesman, would not comment on specific allegations in the suit but said, "The statements made by Miller in this document are incorrect."

Ahold's Form 20-F filing with the SEC for fiscal 2002 shows Miller received a bonus that year of 1.5 million euros, about $1.86 million at the current conversion rate. Miller earned a base salary of $750,000 in 2000. Two experts on executive compensation, quoted by the Washington daily, said the severance package described in the suit was generous.

See the March 5 edition of ID Report

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