On Friday, Delaware Chancellor Chandler granted portions of Michael Ovitz’ motion for summary judgment – and denied the rest. Ovitz won regarding his culpability for entering into his employment contract (because he was not yet an employee) – but will have to defend the part of a shareholder suit over his $140 million severance package (because he was an employee when he entered into that arrangement). The trial starts October 18th.
Meanwhile, expect more fireworks at next year’s Disney annual meeting as Roy Disney and Stanley Gold have called on Disney’s board to reject CEO Eisner’s offer to retire in 2006 as well as Eisner’s choice of President Robert Iger as his successor. The two former board members said they would propose an alternate slate of directors if Disney’s board does not launch an immediate search for a new chief executive and announce that Eisner will step down from the board at the end of the search. The two former board members said a new CEO should be in place before Disney’s next shareholder meeting in early 2005. Eisner has not indicated yet whether he would seek to remain on Disney’s board or remain as a consultant.
Pension Plans to Disclose Votes?
Last week, Senator Ted Kennedy said he would press US pension plans to disclose proxy votes on the stocks they hold – as mutual funds began to do a few weeks ago – in response to a GAO report urging Congress to pass legislation to make their proxy votes public, in an effort to ensure that pension managers act in the best interests of the workers whose nest eggs they are overseeing. Not surprisingly, the GAO report found that pension plans face the same potential conflicts of interest that mutual funds face when they vote.
Enforcement Action Regarding Disclosure Controls
Several weeks ago, I blogged about the importance of the recent SEC Enforcement action against Siebel because it involves disclosure controls – learn more about this important action from my interview with David Brown and Oni Holley on the SEC’s First Enforcement Action Involving Disclosure Controls.