John Ruiz
About John Ruiz
John H. Ruiz (age 58) is Founder, Chief Executive Officer (since 2014), and Chairman of MSP Recovery (MSPR). He is a nationally recognized trial lawyer in healthcare and complex litigation and the founder of MSP Recovery Law Firm; he joined the MSPR board in 2022 and chairs its Nominating & Corporate Governance Committee . The proxy does not disclose TSR or revenue/EBITDA growth tied to his tenure; company KPIs emphasize a large portfolio of assigned claims (approx. $1,592B billed; $380B paid; $87.8B paid value of potentially recoverable claims as of Mar 31, 2025) and platform initiatives (Chase to Pay; Palantir clearinghouse; limited revenue to date for EHR platform) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| MSP Recovery, Inc. | Founder & Chief Executive Officer | 2014–present | Led legal strategy foundational to MSP Act recovery thesis; built data/analytics-driven recovery platform . |
| MSP Recovery Law Firm (La Ley con John H. Ruiz, P.A.; MSP Law Firm PLLC) | Founder/Leader | Various | Lead counsel/co-lead on MSP cases; supports MSPR recovery engine . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Various media/brand initiatives (“La Ley con John H. Ruiz”) | Brand/Media Leader | — | Public brand-building cited by company as part of founder’s credentials . |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | 917,500 (reduced to $35,000 effective 6/26/23; restored 1/1/24) | 1,800,000 |
| Bonus ($) | — | — |
| Stock Awards ($) | — | — |
| Option Awards ($) | — | — |
| Non-Equity Incentive Comp ($) | — | — |
| All Other Comp ($) | 97,108 (incl. $89,832 life insurance via Law Firm) | 7,880 |
| Total ($) | 1,014,608 | 1,807,880 |
Key contract terms for Ruiz:
- Base salary: not less than $1.8M; eligible annual cash bonus up to 100% of base salary; benefits; potential equity under Omnibus Plan at Board discretion .
- Covenants: non-compete and non-solicitation during term .
- Severance: upon termination without cause or resignation for good reason: accrued comp, pro‑rata bonus based on actual results, and 6 months’ base salary .
Performance Compensation
| Incentive | Metric/Weighting | Target | Actual Payout 2024 | Vesting/Terms |
|---|---|---|---|---|
| Annual Cash Bonus | Individual and Company performance objectives (Board-approved) | Up to 100% of base salary | $0 (no bonus reported) | Cash annual; no equity vesting disclosed |
| Equity Awards | — | — | None granted to NEOs in 2024 | As of 12/31/24, no outstanding equity awards for NEOs |
Clawback policy (Recoupment):
- Company adopted an Executive Officer Incentive Compensation Recovery Policy compliant with Exchange Act Rule 10D‑1 and Nasdaq Rule 5608 (applies to current/former executive officers; recovery upon an accounting restatement; methods include cash reimbursement, cancelling/recouping equity gains; no indemnification) .
Equity Ownership & Alignment
| Holder | Class A Shares | % of Class A | Class V Shares (non‑economic) | % of Class V | Notes |
|---|---|---|---|---|---|
| John H. Ruiz | 2,434,188 | 38.53% | 1,397,098 | 42.04% | Includes direct and affiliated holdings (Jocral Family LLLP; Series MRCS); VRM investment disclaimed; excludes sons’ holdings . |
| All Directors & Officers (10) | 4,910,163 | 55.99% | 2,839,323 | 85.44% | Concentrated insider voting control . |
| Spouse (Mayra C. Ruiz) | 1,029,477 | 19.72% | 297,998 | 8.97% | Includes Ruiz Group Holdings LLC . |
Alignment and pledging/hedging:
- Company highlights prohibit hedging, pledging, and short sales; insider trading policy prohibits pledging when in possession of MNPI and bans short sales/options; mandates pre‑clearance and blackout windows .
- Notable exception/flag: MSP Principals pledged 80,000 shares as collateral under a Claims Proceeds Investment Agreement; dispute on number of pledged shares pending; CPIA warrant monetization would precede any share transaction .
Insider buying/selling indicators:
- 2024 related-party disclosure notes MSP issued 17,544 and 14,425 unregistered Class A shares to Virage that were subsequently purchased from Virage by John Ruiz (March 4, 2024 and August 22, 2024), indicating insider purchases .
- Founders’ Up‑C units may be used to satisfy VRM obligations; founders’ reserved shares may be sold with proceeds delivered to VRM (potential selling pressure) .
Employment Terms
| Term | Detail |
|---|---|
| Start/Role | Founder; CEO since 2014; Director since 2022 . |
| Contract | Base ≥$1.8M; target bonus up to 100%; benefits; potential equity awards . |
| Severance | 6 months base; pro‑rata bonus at actual performance; upon without cause/for good reason . |
| Covenants | Non‑compete and non‑solicitation during employment . |
| Clawback | Executive Officer Incentive Compensation Recovery Policy adopted; applies to current/former executive officers . |
Board Governance
- Roles: Ruiz serves as Chairman and CEO; Board states combined role enables “decisive leadership”; no Lead Independent Director designated .
- Committee service: Ruiz chairs Nominating & Corporate Governance; Quesada (CLO) also serves on that committee; Audit and Compensation Committees are 100% independent, chaired by Hawkins (Audit) and Arrigo (Comp) .
- Independence/structure: Board reports 71% independent directors ; Compensation Committee charter allows non‑independent members so long as MSPR remains a “controlled company” under Nasdaq rules .
- Meetings: Board held 12 meetings in 2024; each director attended ≥75% of meetings and applicable committees; executive sessions without management held .
- Liquidity stress signal: Deferred cash portion of director compensation due 6/30/25 ($80,750) remained unpaid “until the Company’s liquidity allows” .
Director compensation (non‑employee; 2024):
| Director | Cash Fees ($) | Stock Awards ($) | Total ($) |
|---|---|---|---|
| Ophir Sternberg | 71,100 | 165,900 | 237,000 |
| Beatriz Assapimonwait | 90,100 | 165,900 | 256,000 |
| Michael Arrigo | 121,100 | 165,900 | 287,000 |
| Thomas Hawkins | 106,100 | 165,900 | 272,000 |
| Roger Meltzer | 96,100 | 165,900 | 262,000 |
| Note: Ruiz and Quesada did not receive separate board compensation in 2024 . |
Compensation Structure Analysis
- Mix shift: 2024 CEO pay was almost entirely fixed cash (100% salary; no bonus or equity granted), weakening explicit pay‑for‑performance linkage for the year .
- Target design: The program contemplates 100% of salary opportunity in annual bonus, but no payout for CEO in 2024; no PSU/RSU or options outstanding for NEOs at year‑end 2024, removing equity‑vesting pressure and near‑term dilution from executive equity .
- Clawback: Robust Dodd‑Frank/Nasdaq‑compliant recoupment policy adopted; no indemnification permitted .
- Consultant/peer oversight: Pearl Meyer engaged as independent advisor to the Compensation Committee; committee empowered to retain advisors; independence assessed per Nasdaq/SEC rules .
- Governance flags: CEO is also Board Chair and chairs Nominating & Governance; company invokes controlled company provisions for committee independence; both can raise independence concerns for investors .
Related Party Transactions (selected; governance risk indicators)
- Promissory note to MSP Principals: $112.8M unsecured note to Ruiz and Quesada (4% PIK; 4‑year maturity); used for merger costs, affiliate payables, operating cash; $5.0M annual interest expense in 2024 and 2023 .
- Advances to Law Firm (affiliate): $36.5M advanced historically; $7.7M expensed in 2024; $1.8M payable to Law Firm at 12/31/24; $4.95M Law Firm loan outstanding (non‑interest‑bearing) .
- VRM “Full Return” obligation: 20% return accruing on Virage contributions; $188.0M and $124.7M interest expense in 2024 related to VRM Full Return and Virage MTA Amendment, respectively .
- Founders’ Up‑C units: Under Virage arrangements, founders’ reserved shares may be sold with proceeds paid to VRM (potential selling pressure) .
- Working Capital Credit Facility: Personal guaranties and additional collateral (pledge of affiliate equity; mortgage on real property) provided by Ruiz and Quesada; company paid certain related fees (e.g., $0.1M legal; $0.4M property taxes via Law Firm repayment) .
- Share transactions: Company issued shares to Virage that were then purchased by Ruiz (17,544 on 3/4/24; 14,425 on 8/22/24) .
Vesting Schedules and Insider Selling Pressure
- No outstanding equity awards for NEOs at FY‑end 2024; therefore, no scheduled vesting overhang for Ruiz .
- Potential forced selling: Founders’ reserved shares may be sold to satisfy VRM Full Return obligations, a possible source of selling pressure for founder holdings .
- Capital structure overhang: Extensive VRM warrant program and restructuring create potential dilution scenarios; MSP Principal Proxy would cap VRM voting at 49% and proxy voting to MSP Principals to maintain 51% voting control if they remain officers and hold ≥25% of Class A, but economic dilution could still be significant .
Performance & Track Record
- Legal accomplishments: Ruiz led legal strategies in multiple MSP Act appellate wins (e.g., Eleventh Circuit decisions), underpinning the company’s recovery model .
- Platform initiatives: Chase to Pay and Palantir clearinghouse platforms highlighted; EHR platform went live Q2’24 with not significant revenue to date .
- Stock performance during tenure and financial growth rates are not disclosed in the proxy; board held 12 meetings with ≥75% attendance per director in 2024 .
Board Service History and Independence Considerations
- Service on MSPR Board since 2022; current committee roles include Chair, Nominating & Corporate Governance .
- No Lead Independent Director; combined CEO/Chair roles; independent directors hold executive sessions without management .
- Independence: Board lists 71% independent directors; Audit and Compensation Committees fully independent; Nominating & Governance includes two executives (Ruiz, Quesada) .
- Director compensation unpaid cash portion (as of 6/30/25) indicates liquidity stress that could affect director retention .
Risk Indicators & Red Flags
- Related‑party complexity (large intercompany loans/advances, Law Firm dependency), and principal share pledges raise governance and alignment questions .
- High‑cost capital/obligations (VRM Full Return at 20% with warrant overhang; Yorkville arrangements referenced) add dilution and financing risk .
- Controlled company posture and CEO control over nominations (as Chair of Nominating & Governance) elevate independence concerns .
- Reverse stock split proposal and unpaid director cash fees underscore listing compliance and liquidity pressures .
Investment Implications
- Alignment: Ruiz’s substantial ownership in both Class A and Class V shares aligns incentives, but potential selling to satisfy VRM obligations and prior pledges introduce overhang and governance risk .
- Pay design: 2024 CEO pay was fixed-cash heavy with no equity/outcome-based payouts, weakening pay-for-performance signals; a robust clawback is in place .
- Governance: Combined CEO/Chair role, control provisions, and executives on the nominating committee warrant a higher governance risk premium despite fully independent Audit/Compensation Committees .
- Liquidity/dilution: The VRM structure (20% return, warrants, and potential share issuance) plus reverse split dynamics and unpaid director cash fees flag financing and dilution risk; investors should monitor consummation of the Virage term sheet and any proxy-driven share issuances .