CEO Leslie Moonves exits CBS without severance package; company says $20 million will be donated to women’s groups
Bowing to pressure brought on by a sexual harassment scandal, CBS Corp. Chairman and Chief Executive Leslie Moonves resigned Sunday, marking a stunning fall from grace for one of Hollywood’s most respected entertainment executives.
CBS announced that it and Moonves will donate $20 million to organizations that support the #MeToo movement and equality for women in the workplace. The donation, which will be made in the coming days, will be deducted from any severance benefits that might have been due to Moonves, who has been accused by multiple women of sexual misconduct.
Moonves’ most recent contract, which was due to expire in 2021, made him eligible to receive an exit deal valued at about $180 million — but now that won’t happen. The CBS board plans to negotiate a financial settlement after the conclusion of an investigation by two prominent law firms into the allegations against Moonves.
In a statement, CBS said that Moonves was exiting immediately and that Chief Operating Officer Joseph Ianniello will serve as president and acting CEO while the board searches for a permanent successor.
“For the past 24 years it has been an incredible privilege to lead CBS’s renaissance and transformation into a leading global media company,†Moonves said in a statement. “Untrue allegations from decades ago are now being made against me that are not consistent with who I am…. I am deeply saddened to be leaving the company.â€
CBS separately agreed to drop a lawsuit against the Redstone family investment vehicle, National Amusements Inc., that had been scheduled to go to trial in Delaware in October. The deal also calls for a dramatic makeover of the CBS board, with six new directors who are not aligned with the Redstone family.
Moonves becomes the highest-profile media executive to see his career collapse from the weight of sexual harassment allegations that surfaced in the #MeToo era. Hollywood, and other industries, have been forced to account for years of turning a blind eye to sexual harassment and discrimination after allegations that movie producer Harvey Weinstein had sexually abused dozens of women. In the case of Moonves, there were fewer allegations of misconduct, but the stakes were higher because he managed a publicly traded company, which must protect the interests of shareholders.
“These allegations speak to a culture of toxic complicity at CBS, where the safety of women was continuously ignored to protect the careers of powerful men and the corporation,†a representative of the Times Up movement said in an email Sunday. “The CBS board of directors has an obligation to move swiftly and decisively to create a safe work environment for all and rid the company of this toxic culture.â€
Moonves’ departure was not unexpected. The 68-year-old executive had been negotiating a settlement with independent CBS board members in recent weeks, but those talks accelerated after a report Sunday in New Yorker magazine, which detailed six women’s allegations involving him in the 1980s and 1990s, including reports that he demanded massages from women or forcibly kissed them. At least 12 women have alleged that Moonves made inappropriate advances toward them.
The report included the account of a former Lorimar television executive, Phyllis Golden-Gottlieb, who described being attacked by Moonves in the mid-1980s when the two were colleagues at the prolific TV studio.
Golden-Gottlieb filed a report with the Los Angeles Police Department last year, and police found her allegations to be credible, according to law enforcement sources. She described two incidents, including one in which she said Moonves demanded that she perform oral sex on him. In the second incident, Moonves was angry over a work matter and allegedly slammed her against a wall. But prosecutors declined to bring charges because the incidents were more than 30 years old and the statute of limitations had expired.
“CBS takes these allegations very seriously,†the network said Sunday in a statement. “Our board of directors is conducting a thorough investigation of these matters, which is ongoing.â€
The company’s stock is down 10% this year, and board members faced heavy pressure to respond quickly to a scandal that threatened the company’s business and reputation.
“CBS has a lot of work to do,†said Diane Doolittle, a trial lawyer with the Los Angeles law firm Quinn Emanuel. “Like everyone, I am shocked, saddened and disgusted by the nature of the allegations, the number of women and the force of the violence that is being alleged.â€
The allegations against Moonves came to light as CBS was struggling to mop up a separate scandal at its vaunted CBS News division. Longtime PBS personality and CBS morning news host Charlie Rose was ousted late last year after allegations by women that he acted inappropriately. In addition, “60 Minutes†executive producer Jeff Fager has been accused of boorish behavior and tolerating inappropriate conduct at the storied newsmagazine. An outside law firm has been investigating the CBS News culture since March.
Moonves’ exit represents a spectacular reversal of fortune for one Hollywood’s most powerful executives who has been the face of CBS since 1995. He took over a floundering television network and steadily built it into a juggernaut that attracts more viewers than any other U.S. TV network. Since 2006, Moonves has served as chief executive of CBS Corp., which, in addition to the broadcast network, owns a string of television stations, a growing television production studio, the Showtime premium channel, the Simon & Schuster publishing house and a 50% stake in the CW network.
When Moonves joined CBS, the network was on the ropes in the ratings. He steadily rebuilt the network with a string of hits, including “Everybody Loves Raymond,†“Survivor,†“CSI: Crime Scene Investigation,†“NCIS,†“Two and a Half Men,†“The Amazing Race,†and “The Big Bang Theory.â€
He was elevated to CBS Corp. chief executive in 2006 when Sumner Redstone divided his empire into two publicly traded companies, CBS and Viacom. Moonves, in the last decade, reshaped the company by launching streaming services, building a CBS digital product and shedding mature businesses such as the billboard division and radio stations.
Moonves also maintained the distinction of being one of America’s highest-paid CEOs. Last year, he received a compensation package worth $69.3 million.
But his tenure atop the media company took a big hit in late July when the New Yorker published a devastating piece from investigative reporter Ronan Farrow that highlighted claims of an actress, Illeana Douglas, who said Moonves tackled her at the end of a business meeting in his CBS office in 1997.
Moonves acknowledged mistakes in his conduct, saying he recognized “there were times decades ago when I may have made some women uncomfortable by making advances.†But he denied harassing anyone and also pointed to his record of promoting women to high-profile roles.
Several prominent female executives — film executive Terry Press, advertising sales chief Jo Ann Ross and Moonves’ wife and CBS talk show host, Julie Chen — rallied around Moonves in a show of support after the initial article.
But the damage was done. Three days after the article was published, one of the network’s biggest stars — Stephen Colbert — told his “The Late Show†audience that “accountability is meaningless unless it’s for everybody, whether it’s the leader of a network or the leader of the free world.â€
CBS’ board of directors last month hired two high-profile female attorneys from powerhouse New York law firms to investigate the allegations of sexual harassment and examine the company’s workplace culture, including within the CBS News division. They have interviewed dozens of people who work at CBS and former executives and assistants who left long ago, according to several knowledgeable people.
Moonves’ departure will give a boost to Shari Redstone, daughter of the ailing patriarch Sumner Redstone who now oversees the family’s voting stake in CBS and serves as vice chair of the company. She has clashed with Moonves over her attempt to reunite CBS and Viacom, which Moonves and a majority of the CBS board were fighting to block. Redstone has since dropped her support for such a merger.
But the dispute flared in mid-May, when the CBS board sued the Redstone family and National Amusements in an attempt to dilute their interest in the venerable broadcasting company. Redstone and National Amusements filed a countersuit, creating a major distraction for CBS.
CBS independent board members balked at the idea of reuniting the companies, fearing that Viacom’s struggling cable television channels, such as MTV and Comedy Central, would weigh down CBS’ business prospects. Then media reports began circulating that Redstone was looking to replace several board members. In legal papers, the family has said it would advocate for a merger only if it made sense for both companies.
National Amusements controls nearly 80% of the voting stock of both CBS and Viacom. As part of the truce, National Amusements agreed not to propose a merger between CBS and Viacom for at least two years. CBS’ board also will be allowed to entertain offers from other prospective buyers — even if such a combination resulted in the dilution of the Redstones’ control.
And, in a sign of lingering boardroom tensions, the company adopted a policy that requires board members and senior executives to immediately notify the entire board if they become aware of a potential merger or business combination that would involve CBS. In legal documents, CBS complained that Shari Redstone had unilaterally rebuffed the advances of one telecommunications company, an accusation she denied.
Ianniello, the acting CEO, has been with CBS, and its corporate predecessor Viacom, for 18 years. He is deeply familiar with the company’s finances and has helped to plot the company’s business strategy, but, unlike Moonves, he lacks relationships in Hollywood.
CBS has been considering bringing in a high-level entertainment executive from outside CBS to oversee programming executives in Los Angeles, according people familiar with the matter.
Times staff writer Richard Winton contributed to this report.
Twitter: @MegJamesLAT
UPDATES:
8:06 p.m: This story has been update to include a statement from Les Moonves
4:25 p.m.: This post was updated to include a statement from CBS.
1:55 p.m.: This article was updated to include details about CBS Chief Executive Leslie Moonves’ exit, and a separate agreement between CBS independent board members and National Amusements Inc.
This article was originally published at 11:15 a.m.
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