Ex-Disney board members to give new depositions in Ovitz lawsuit
By Gary Gentile
ASSOCIATED PRESS
12:40 a.m. June 2, 2004
LOS ANGELES – Former Walt Disney Co. board members Stanley Gold and Roy E. Disney have been ordered to give new depositions in a shareholder lawsuit against the company over the brief tenure of former Disney president Michael Ovitz.
A Delaware judge gave the law firm representing shareholders in that lawsuit permission to take new depositions from the two because of inconsistencies in their pre-resignation testimony and their post-resignation criticisms of the Disney board.
The two were members of the board in 1995 when they approved the hiring of former Hollywood agent Ovitz as Disney president. They were also on the board little more than year later when Ovitz left with a severance package that included a $38.9 million cash payout and stock options valued at more than $100 million.
Gold gave a second deposition last week and Roy Disney is set to testify again this week, said Steven Schulman, an attorney representing shareholders in the lawsuit.
The complaint claims the Walt Disney Co. board – including Gold and Roy Disney – was negligent in not consulting an expert before approving Ovitz's employment contract and that Disney Chairman Michael Eisner allowed Ovitz, a close friend, to collect a severance payment to avoid personal embarrassment.
Roy Disney gave a deposition in the case last June, and Gold testified last October. Both said they fully supported Eisner's courting of Ovitz. They also said they supported the decision to terminate Ovitz on a no-fault basis.
After their resignations last fall, Gold and Roy Disney embarked on a campaign to oust Eisner and attacked the Disney board for being Eisner's "rubber stamp" during a time period that included Ovitz's brief stint as company president.
In one document, posted on their "SaveDisney" Web site, Michael McConnell, managing director of Shamrock Holdings, a private company that manages Roy Disney's investments, said the hiring of Ovitz "foreshadowed the current 'poor governance' culture and Michael's (Eisner) disconnect with the people for whom he works; the shareholders.
"The company image has suffered long-term damage and the board has yet to design a succession process or plan that gives investors comfort," McConnell wrote.
Gold is the head of Shamrock.
Papers filed in connection with the shareholder lawsuit were also cited by state pension funds as one reason to withhold their votes for Eisner's re-election to the board in March.
The public campaign waged by Gold and Roy Disney prompted lawyers in the shareholder lawsuit to ask for permission to take new testimony from the two.
Lawyers representing Gold and Roy Disney had argued that their later public statements did not contradict their earlier testimony.
A trial in the lawsuit is scheduled to begin Oct. 18.
By Gary Gentile
ASSOCIATED PRESS
12:40 a.m. June 2, 2004
LOS ANGELES – Former Walt Disney Co. board members Stanley Gold and Roy E. Disney have been ordered to give new depositions in a shareholder lawsuit against the company over the brief tenure of former Disney president Michael Ovitz.
A Delaware judge gave the law firm representing shareholders in that lawsuit permission to take new depositions from the two because of inconsistencies in their pre-resignation testimony and their post-resignation criticisms of the Disney board.
The two were members of the board in 1995 when they approved the hiring of former Hollywood agent Ovitz as Disney president. They were also on the board little more than year later when Ovitz left with a severance package that included a $38.9 million cash payout and stock options valued at more than $100 million.
Gold gave a second deposition last week and Roy Disney is set to testify again this week, said Steven Schulman, an attorney representing shareholders in the lawsuit.
The complaint claims the Walt Disney Co. board – including Gold and Roy Disney – was negligent in not consulting an expert before approving Ovitz's employment contract and that Disney Chairman Michael Eisner allowed Ovitz, a close friend, to collect a severance payment to avoid personal embarrassment.
Roy Disney gave a deposition in the case last June, and Gold testified last October. Both said they fully supported Eisner's courting of Ovitz. They also said they supported the decision to terminate Ovitz on a no-fault basis.
After their resignations last fall, Gold and Roy Disney embarked on a campaign to oust Eisner and attacked the Disney board for being Eisner's "rubber stamp" during a time period that included Ovitz's brief stint as company president.
In one document, posted on their "SaveDisney" Web site, Michael McConnell, managing director of Shamrock Holdings, a private company that manages Roy Disney's investments, said the hiring of Ovitz "foreshadowed the current 'poor governance' culture and Michael's (Eisner) disconnect with the people for whom he works; the shareholders.
"The company image has suffered long-term damage and the board has yet to design a succession process or plan that gives investors comfort," McConnell wrote.
Gold is the head of Shamrock.
Papers filed in connection with the shareholder lawsuit were also cited by state pension funds as one reason to withhold their votes for Eisner's re-election to the board in March.
The public campaign waged by Gold and Roy Disney prompted lawyers in the shareholder lawsuit to ask for permission to take new testimony from the two.
Lawyers representing Gold and Roy Disney had argued that their later public statements did not contradict their earlier testimony.
A trial in the lawsuit is scheduled to begin Oct. 18.
