The Goldman Sachs annual meeting scheduled for Tuesday, April 3, should be a celebration, considering that the company raked in record-breaking profits of $9.5 billion last year.

But the party may have to wait if an irate shareholder gets his way.

Last week, Jeffrey W. Bader, a New York-based defense lawyer, filed a lawsuit against Goldman’s officers and directors alleging that the company’s most recent proxy statement undervalues the price of stock option awards granted to top executives and “materially understates the total compensation of the CEO and the other named executives.”

The lawsuit, filed March 16 in U.S. District Court in New York, seeks to halt the 2007 annual meeting or, in the absence of such an injunction, to cancel any election of directors, and demands an “equitable accounting” of the allegedly excessive compensation. The lawsuit also requests that the defendants make reparations, either with money or a reduction in the amount of options granted.

Bader’s lawsuit is likely just the first salvo in a battle-charged proxy season. Experts say the Securities and Exchange Commission’s new disclosure rules will continue to reveal pay packages that will outrage some shareholders—or simply arm other, more jaded types with fresh ammo for their personal causes.

Meanwhile, more than 60 companies noted for having excessive compensation were recently hit with shareholder proposals for the so-called “say on pay” vote. Throw in the battle for shareholders’ access to the corporate ballot, and shareholder activism seems to be hitting new highs.

In his suit, Bader alleges that Goldman undervalued stock option awards by more than $23 million because it didn’t correctly apply the Black-Scholes model for pricing options. For example, Goldman CEO Lloyd Blankfein earned $54.7 million in 2006, according to the firm’s proxy, but Bader charges that his actual compensation was $60.2 million.

Bader is no stranger to the courts. Last year his wife, Lauri Cohen Bader, filed a similar lawsuit against Lehman Bros. Lehman entered into a settlement agreement with Bader in January and is awaiting final approval from the U.S. District Court in New York. Bader also recently sued Fannie Mae for similar reasons.

His lawyer, Arnold Gershon, said he didn’t know whether the Baders planned to file lawsuits against other companies regarding the pricing of stock options.

Filed by Jeff Nash of Investment News, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.