CBS Corporation indicated in a government filing on Monday that it may not release the results of an ongoing investigation into the conduct of ousted CEO Les Moonves, whoover allegations of sexual assault and sexual misconduct.
The companytwo outside law firms to investigate the allegations against Moonves, as well as other reports of sexual harassment and an inappropriate culture for women throughout CBS and the CBS News division.
But as part of CBS' settlement with Moonves, which was included in a filing with the SEC on Monday, the company agreed that it "shall seek to preserve the confidentiality" of the reports into Moonves' conduct "to the maximum extent possible consistent with fiduciary duties of directors and all applicable laws."
It's not clear what is meant by "maximum extent possible," but John Utz, whose firm Utz & Lattan focuses on employee benefits and executive compensation law, said "unless the board itself decides it has a fiduciary duty to do so, it won't be made public. The board has to make a decision about whether keeping it confidential might harm the company, whether with advertisers or stockholders."
A source familiar with the matter said the board could still decide to release the findings, though it has not considered what it will do yet. The clause "doesn't handcuff the board one bit," the source said. "It's up to the discretion of the board. It will depend on what's best for the company." The source also said it's too early in the process to make that determination.
The two law firms, Debevoise & Plimpton and Covington & Burling, have conducted investigations for other institutions and organizations. They have made findings public in some cases, but not all.
A spokesperson for CBS did not respond to requests to confirm whether the findings would be made public.
The SEC filing also gave additional details about the exit agreement with Moonves:
- It says that Moonves could receive a potential payout of $120 million if not terminated for cause. He had been eligible for as much as $180 million, according to an employment contract he signed in May 2017. Moonves has denied the allegations against him.
- CBS will donate $20 million to one or more organizations that support the #MeToo movement and equality for women in the workplace. The organization or organizations would be selected by Moonves in consultation with CBS.
- The donation will be made within 30 days, the SEC filing said. The company's statement on Sunday indicated that the $20 million had been deducted from the amount Moonves could potentially receive. That indicates the value of Moonves' potential package is $140 million.
- If he's not terminated for cause, Moonves will stay on to "perform transition advisory services" for one year. To facilitate one year of advisory services, he would receive two years of "office services and security services." Office services include a "personal secretary," according to his employment contract.
- Neither the board nor the law firms have given a timeline to complete the investigation. The SEC filing indicates that it should conclude by early next year. "The Board will make a determination whether the Company has grounds to terminate the employment of Mr. Moonves for cause under his employment agreement within thirty (30) days following completion of the final report of the independent investigators in the current internal investigation, but in no event later than January 31, 2019."
Reporting by Erin Donaghue, Jillian Harding, Lex Haris, Graham Kates and Irina Ivanova.