Lots of big questions at Int’l Rectifier…

October 4, 2007

irf110905l.jpgWhen International Rectifier (IRF) announced late Tuesday that its long-time CEO, Alex Lidow, who had been placed on leave just before Labor Day, had resigned “effective immediately”, it left many questions unanswered.

As the LA Times reported, Lidow, pictured ringing the bell at the NYSE two years ago, was the third high-ranking executive to leave following the announcement of an internal accounting investigation and the non-reliance on IRF’s previously issued numbers. The company, whose chips can be found in Sony Playstation 3s, most recent Q was filed on Feb. 9. As Herb Greenberg reported in July, the controversy didn’t have much of an impact on the company’s stock price. But all of that is the back-story.

One question is what role Lidow’s father, the 94 year-old founder and chairman of the company had in his son’s ouster. But perhaps more important is how this is likely to play out going forward. In the separation agreement that was filed on Tuesday, it was interesting to note what standard language was missing from the agreement: the right of either party not to sue.

As the contract notes, “neither Lidow nor the Company releases the other from any claim whatsoever by entering into this Agreement.” Given how provisions not to sue are fairly standard in these sorts of things, you have to wonder which one will make it to the courthouse quicker: the father or the son.

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