Leslie Moonves, the former chairman and chief executive of CBS Corp.CBS, +1.86% who resigned amid accusations of sexual harassment last September, is challenging the company’s decision last month to deny him his severance package of $120 million, CBS said in a filings with the Securities and Exchange Commission.
CBS’s board said there were grounds to terminate Moonves and deny him the severance after an investigation concluded that Moonves had violated company policies, breached his employment contract and intentionally failed to fully cooperate with the investigation. The terms of his exit agreement from CBS allow Moonves to challenge that decision in arbitration.
The decision to take CBS to arbitration was expected. A lawyer for Moonves said at the time that the board’s conclusions were without merit. “Mr. Moonves vehemently denies any nonconsensual sexual relations and cooperated extensively and fully with investigators,” said Andrew Levander of Dechert LLP.
The next step will be for the two parties to agree on an arbitrator through the American Arbitration Association, where the claim was filed Wednesday. Typically for complex situations, a panel of three arbitrators is retained. The $120 million has been in escrow since Moonves left the company.
The two sides could still try to hammer out their own settlement. However, the scrutiny CBS is facing regarding its handling of harassment issues at the company from activist groups supporting the #MeToo movement may make any payment for Moonves a public-relations nightmare.
An expanded version of this story appears on WSJ.com.
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