Shares of CBS Corp. are falling on multiple reports that the CBS board is meeting to decide the fate of CEO Les Moonves as the company investigates sexual harassment claims against him.
The stock (CBS) is down $2.90, or roughly 5.4 percent, at $51.12 in late trading. The drop in CBS shares follows a 6 percent decline on Friday when the report first surfaced.
The claims, that Moonves harassed six women over decades, surfaced Friday in a report from the New Yorker.
The CBS chief has been a prominent figure in television for decades, credited with turning around a network that had been mired for years at the ratings bottom.
Among other things, Moonves has had a knack for picking hit shows like "Survivor" and "The Big Bang Theory."
Meanwhile, CBS’ board will discuss the investigation into allegations of personal misconduct against Moonves on Monday, according to two people familiar with the matter told Reuters.
The allegations come as Moonves is embroiled in a legal battle over control of CBS with the company’s largest shareholder, National Amusements Inc., owned by Shari Redstone and her father Sumner, who also control media company Viacom Inc.
CBS said on Friday it would investigate accusations against Moonves, 68, made by six women in a New Yorker magazine article featuring several instances of alleged sexual harassment spanning 1985 to 2006.
Moonves said in a statement on Friday that he regretted “immensely” making some women uncomfortable by making advances, but added that he abided by the principle that ‘no’ means ‘no,’ and stated he has never misused his position to harm or hinder anyone’s career.
At a regularly scheduled board meeting on Monday ahead of the company’s second-quarter earnings on Thursday, CBS directors will discuss forming a special committee to handle the Moonves investigation and decide which law firm the company will hire to help with the probe, one of the sources said.
Some CBS directors are also expected to raise the issue of whether Moonves should step aside while the probe takes place, the second source said.
CBS’ board will also discuss how to investigate allegations that the company’s culture facilitated personal misconduct, according to the sources.
The sources asked for anonymity from Reuters to discuss confidential deliberations. A National Amusements spokesman declined to comment on behalf of the company and Redstone. A CBS spokesman also declined to comment on behalf of his company and Moonves. Moonves himself did not respond to an email seeking comment.
Shari Redstone has a seat on CBS’ 14-member board, alongside her personal lawyer Robert Klieger and National Amusements director David Andelman. It is unclear how much pressure Moonves will face at the board meeting on Monday to step aside.
While many CBS directors were appointed to the board by Sumner Redstone, some turned against the Redstone family in May as part of a special board committee that sought to challenge the Redstone family’s voting control.
Deadline Hollywood reported on CBS' upcoming board meeting earlier on Sunday.
Moonves clashed with Shari Redstone earlier this year when he rejected her latest attempt to merge CBS with Viacom Inc. (VIA), another media company that is also majority-owned by National Amusements.
Moonves has been resisting a deal to unite CBS and Viacom because he has said CBS’ prospects were better without taking on Viacom’s turnaround challenges. Without Moonves at the helm, a major obstacle to Redstone’s aim of merging the two companies would be removed.
CBS and National Amusements are also scheduled to battle it out in a Delaware court in October over CBS’ plan to issue a special dividend aimed at cutting National Amusements’ voting power in the company to 17 percent from 80 percent. Without Moonves as CEO, it’s not clear whether CBS would continue with this legal challenge.
(Newsmax wire services Reuters and the Associated Press contributed to this report).
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