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The Disneyland Report > Disney News > Disney set to defend Ovitz’s severance Disney NewsDisney set to defend Ovitz’s severanceThe Associated Press LOS ANGELES -- As The Walt Disney Co. plans for a future without iconic CEO Michael Eisner, a lawsuit filed by disgruntled shareholders is forcing Disney to relive one of his most embarrassing mistakes, hiring Michael Ovitz as president. The suit filed back in 1997 is finally going to a trial that will feature some of Hollywood’s biggest egos, including Eisner and Ovitz, the famed talent agent whose tumultuous reign at Disney ended after just 14 months. It is also expected to reveal some of the less-than-savory dealings at Disney during one of the company’s most difficult periods. Shareholders are objecting to Ovitz’s severance package, valued at about $140 million. The lawsuit charges that Disney’s board at the time was negligent in not consulting an expert before approving Ovitz’s contract and that Eisner let Ovitz collect the money to avoid personal embarrassment. The trial is set to begin Oct. 18 in Delaware, where, like so many companies, Disney is incorporated. Although Eisner and then-board members including Ovitz are defendants, shareholders brought the suit on behalf of the company, which would benefit from any judgment. When Ovitz was hired in 1995, Disney had just become a media giant with the purchase of Capital Cities/ ABC but was still reeling from the death of its president, Frank Wells the previous year. Ovitz claims he was doomed from the start: micromanaged by Eisner, undermined by key executives and forced to leave before he had time to prove his worth. Eisner and the company contended Ovitz was a lavish spender whose arrogance alienated executives and who ultimately could not be trusted. Ovitz recently succeeded in dismissing part of the case against him, but must still defend his role in approving his severance package. To read the rest of this article, click here.Return to Disney News. |
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