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Grasso defamation claim dismissed

/ Source: The Associated Press

A New York state court judge on Tuesday dismissed a defamation claim filed by former New York Stock Exchange Chairman Dick Grasso against his successor at the Big Board, John Reed.

The defamation claim was part of Grasso's legal response to the excessive-compensation lawsuit brought against him by New York Attorney General Eliot Spitzer. Grasso had argued that Reed, who took over the exchange after Grasso left in September 2003, defamed him in public statements in the months following Grasso's departure.

One of Grasso's attorneys, Gerson Zweifach, told Judge Charles Ramos that he objected to the comments made by Reed. These included remarks made by Reed to The New York Times in December 2003, as well as comments made on other occasions. In one instance, Reed said the NYSE couldn't be run like a club; another time, he referred to a scenario in which Grasso could write the exchange a check for $150 million to end the pay dispute.

But Ramos ended up siding with Robert Michels, an attorney for the NYSE and Reed, whose arguments included the contention that Reed was simply expressing his opinion about a dispute that had been extensively covered by the press and commented upon by others.

Grasso, who has denied Spitzer's charges, still has other claims of his own pending, including his allegation that he is still owed money by the exchange. Grasso has pledged to give any money he collects to charity. The NYSE has denied Grasso's claims.

As reported, Spitzer is alleging violations of the New York law that governs not-for-profit institutions such as the Big Board and wants Grasso to return a substantial part of his pay.