CBS Stock Drops on Rumor Of Reports on Moonves

'New Yorker' story charges CEO with sexual misconduct
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CBS chief Les Moonves

CBS stock dropped Friday amid reports that The New Yorker was about to publish a story accusing CBS CEO Leslie Moonves of sexual misconduct.

The story said Moonves kissed and touched some people in an unwanted way, according to The Hollywood Reporter. Some of those claims may be 20 years old.

Moonves and CBS have been involved in a dispute for control of the company with the family of media mogul Sumner Redstone, led by his daughter Shari Redstone.

Shari Redstone urged CBS to merge with Viacom, which the Redstone’s also control. Instead, CBS’ board tried to take steps to remove Redstones' control, which are now subject to a lawsuit.

Related: Shari Redstone Sues Moonves Over Ownership Dilution Move

“All allegations of personal misconduct are to be taken seriously,” CBS’s independent directors said in a statement. “The Independent Directors of CBS have committed to investigating claims that violate the Company’s clear policies in that regard. Upon the conclusion of that investigation, which involves recently reported allegations that go back several decades, the Board will promptly review the findings and take appropriate action.”

The directors added that “the timing of this report comes in the midst of the Company’s very public legal dispute. While that litigation process continues, the CBS management team has the full support of the independent board members. Along with that team, we will continue to focus on creating value for our shareowners.”

Last year, CBS dismissed Charlie Rose as host of CBS This Morning because of allegations of sexual harassment.

The New Yorker story supposedly deals with broader cultural issues at CBS.

CBS stock was down nearly 6% to $54 a share at mid day.

Moonves has been uniquely identified with CBS’ recent success both in picking shows for the networks primetime line up and for its strategy of pushing the company away from a dependence on advertising and into international content sales and over-the-top direct to consumer products.

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