BlackRock is facing a lawsuit filed by a former employee alleging the asset manager failed to pay $12.4 million owed under a promised compensation agreement. The suit was filed Monday in New York State Supreme Court by Neal Dignum, who worked as a director in BlackRock’s Long Term Private Capital fund from November 2021 until February 2023.

According to court documents, Dignum claims BlackRock never formalized the carried interest component of his pay package in writing despite assurances during his tenure. His legal team contends the firm intentionally withheld the promised compensation and failed to create a binding agreement. Lauren Zimmerman, a partner at Benesch Friedlander Coplan & Aronoff LLP representing Dignum, stated that BlackRock “decided it did not want to keep its end of the bargain it struck, even after aggressively courting” her client.

The lawsuit could compel BlackRock to disclose details about its typically confidential pay structure for senior employees, shedding light on how compensation arrangements are handled within the firm. BlackRock, which manages over $15.3 trillion in assets and is the largest asset manager globally, did not respond to requests for comment.

This legal dispute highlights ongoing tensions in the private capital sector regarding carried interest payments, a form of incentive compensation tied to investment performance. The case will proceed in New York state court as both sides address the allegations and BlackRock’s contractual obligations to Dignum.