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Corporate Conflict

There's feuding in the Magic Kingdom and turbulence at Boeing, as two of America's big-name firms face major shakeups at the highest levels of management.

At Walt Disney Co., a key ally joined Roy E. Disney in resigning from the board on Monday, becoming the second vocal opponent of chairman and chief executive Michael Eisner to quit in two days.

Stanley Gold issued a long rebuke to Eisner and the Disney board Monday, seconding complaints made Sunday by Roy Disney and further criticizing the board ad a rubber stamp to senior management.

Gold also repeated Disney's calls for Eisner to resign.

Meanwhile, Boeing Co. chairman and chief executive Phil Condit resigned unexpectedly only days after the huge aerospace manufacturer fired two other Boeing officials for an alleged ethics breach.

The company's board accepted Condit's resignation after deciding "a new structure for the leadership of the company is needed," according to a Boeing statement released Monday.

Gold's resignation from Disney comes as the company's board begins two days of meetings in New York.

In a letter to Eisner, Gold said, "It is clear to me that this board is unwilling to tackle the difficult issues I believe this company continues to face. Among the problems, he said, were "the cannibalization of certain company icons for short-term gain, the enormous loss of creative talent over the last years, the absence of succession planning and the lack of strategic focus."

Gold played a key role along with Roy Disney in 1984 to save the company from a takeover attempt and install Eisner as chairman. He heads Shamrock Holdings, which manages Roy Disney's investments.

But Gold's role has been diminished over the past two years as he has become more of a critic of Eisner's performance.

Disney, 73, is the last family member active in the company, founded in 1923 by his uncle Walt and his father, Roy O. Disney, who was the business manager. He also is quitting as chairman of the company's animation division.

Disney has called for Eisner's resignation in the past, but the idea was rejected by the board. On Sunday, he sent a three-page letter to Eisner that criticized the chairman's leadership over the past seven years, according to The Wall Street Journal, which first reported the story.

"It is my sincere belief that it is you that should be leaving and not me," Disney told Eisner in the letter.

He accused Eisner of "muzzling" his voice on the board.

"Michael, I believe your conduct has resulted from my clear and unambiguous statements to you and the Board of Directors that after 19 years at the helm, you are no longer the best person to run the Walt Disney Company," Disney wrote.

His departure may have been a pre-emptive move, because the company said he is over the mandated retirement age of 72.

Eisner is credited with transforming Disney from a producer of mediocre films and caretaker of two theme parks in 1984 into a media giant, whose holdings include five theme parks around the world, the ABC-TV network, the ESPN sports cable channel and one of the highest-grossing movie studios.

But Eisner has taken heat for what critics see as micromanaging leadership style. Detractors also accuse him of presiding over a "brain drain" that saw top executives leave the company over the past 10 years.

Disney's stock has fallen from more than $40 per share in 2000 to under $14 in 2002. The stock has risen nearly 34 percent since the beginning of the year as the company's fortunes have gradually improved.

For its part, Boeing has been roiled for months by ethical controversies over the aggressive methods it used to obtain lucrative defense contracts.

For decades, Boeing was primarily an aircraft maker, earning most of its money from its jetliners. But in the aftermath of the Sept. 11, 2001, terror attacks, Boeing's defense division now brings in more revenue than commercial airplanes. Boeing has expanded its space, communications and other businesses as well.

Company spokesman John Dern insisted Condit was not fired and said the board accepted his voluntary resignation "with great sadness."

The shake-up comes a week after Boeing unexpectedly fired its chief financial officer, Mike Sears, for unethical conduct, saying he negotiated the hiring of an Air Force missile defense expert while she was still working for the Pentagon and was in a position to influence Boeing contracts. Sears has denied any wrongdoing.

Sears was dismissed along with the former Air Force official, Darleen Druyun. She was hired earlier this year as vice president and deputy general manager of Boeing's Missile Defense Systems unit.

Defense Department investigators are examining a newly approved deal to acquire 100 Boeing 767 planes for use as midair refueling tankers.

The deal was criticized this fall when documents revealed that Druyun, then the principal deputy assistant Air Force secretary for acquisition and management, told Boeing that Airbus had submitted a bid $5 million to $17 million less per plane than Boeing's offer.

Boeing made no connection between Condit's departure and the firings in its Monday announcement. Dern said the board has been meeting for the past several days to discuss a course of action, but he declined to say when the resignation was made or accepted.

"To link it to any single event would be a mistake. But there have been distractions over the last year, and both Phil and the board agreed that this decision was a way to put these distractions behind the company," he said. "The board felt that changing leadership as well as the structure ... would help drive the company forward."

The Boeing board named former Hewlett-Packard Co. president and chief executive Lewis E. Platt, 62, as non-executive chairman and former Boeing president and chief operating officer Harry C. Stonecipher, 67, as president and CEO, effective immediately.

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