Hot and heavy inter-office affairs, making millions in funny money trading, this story has everything even a surprise ending!

Amid allegations of extramarital affairs with female employees, illegal activity in trading accounts, and the misuse of company aircraft, Robert O'Connell was unceremoniously fired for cause as chief executive of Massachusetts Mutual Life Insurance by its directors in June 2005.

Now a three-person arbitration panel has found that O'Connell did not breach his fiduciary duties to MassMutual and that he is owed benefits that could reach $50 million, his lawyers say.

The seats filled by corporate directors have never been hotter. Directors have come under fire for not being vigilant enough when it comes to accounting practices or sky-high pay packages for executives. In the wake of the Hewlett-Packard upheaval, directors are in the spotlight over how they conduct investigations. The MassMutual episode, though, could illustrate how boards, in an effort to appear tough on corporate malfeasance, might need to pay more attention to the process of dismissal.

The arbitration panel said that O'Connell had in fact had affairs with two female employees, made millions in profit in a deferred compensation account by trading using closing prices from the day before, and perhaps even stepped over the line in use of the company aircraft.

But none of these acts constituted "willful gross misconduct" on his part or resulted in "material harm" to the company, the arbitration panel ruled.

MassMutual executives declared the panel's findings "incomprehensible" and inconsistent with good corporate governance. On Friday, the company filed suit in a Massachusetts court to appeal the panel's finding, which was made last month but not disclosed until Friday.

O'Connell's lawyers declared victory.

http://www.iht.com/articles/2006/10/22/business/ceo.php