In March 2009, ailing insurance giant triggered a national outcry when it paid out $165 million in government bailout funds for employee bonus incentives. President Obama called the bonus payments an “outrage” and promised that his administration would “pursue every single legal avenue to block these bonuses and make the taxpayers whole.” One possible answer lies with the remedy of restitution. Restitution, based on unjust enrichment, provides a common law solution that just might work. Unjust enrichment is a remedy directed at the defendant that requires the wrongdoer to return all ill-gotten gains. The goal is to return the defendant to the position it would have been in but for the wrongdoing, and prevent it from profiting at the plaintiff’s expense. While some might consider the idea of an unjust enrichment remedy a “hail Mary” pass, this longshot provides a good analytical foundation to funnel the public outrage towards a legal resolution based on justice.
Comments, Washington U. L. Review
Tracy A. Thomas, Bailouts, Bonuses, and the Return of Unjust Gain, 87 Comments, Washington U. L. Review 437 (2009) (online).