Legal Challenges Mount for Private-Equity Titans Over Lucrative Lawsuits

Lawsuits seeking to recover compensation from private-equity founders who allegedly received excessive pay for little work are gaining momentum, as investors and regulators scrutinize the industry's practices. These lawsuits, known as "money-for-nothing" cases, are being filed against private-equity firms and their founders, accusing them of breaching their fiduciary duties by taking excessive fees and not providing commensurate value. The increased attention on these cases is putting pressure on private-equity firms to justify their compensation practices and could lead to significant legal and financial consequences for the industry.