Shareholders of the former CBS have settled a long-running securities class action lawsuit with the company over its handling of sexual assault allegations against former CEO Les Moonves. The $14.75 million cash settlement covers shareholders of CBS from November 2017 to July 2018.
Moonves was pushed out of CBS in 2018 after multiple accusations. Investors led by the Construction Laborers Pension Trust for Southern California, claimed that public lies and omissions by the company and Moonves left investors in ignorance of a full-blow sexual harassment scandal unfolding within. They said they lost money after news of the allegations became public and sued the broadcaster in New York federal court for violating securities law.
“Defendants made numerous materially false and misleading statements and/or omissions regarding the Company’s policies and corporate governance, the importance of key personnel, including Moonves, and other statements made to news media, which caused the price of the Company’s common stock to trade at artificially inflated prices, until the market learned of the false and misleading nature of the statements, and the Company’s stock price significantly declined,” the suit said.
Specifically, the lawsuit claims Moonves and other defendants made “materially false and misleading statements regarding the Company’s business, operational and compliance policies.”
CBS had argued that securities law doesn’t required it disclose sexual misconduct allegations or their potential impact on the business and to a certain extent the judge had agreed with them in subsequent rulings. Shareholders have said the settlement “balances the risks, costs, and delays inherent in complex securities class action cases.”
Moonves, for years the face of CBS and one of most highly respected executives in the business, became a face of the MeToo movement following New Yorker article including accusations by multiple women of harassment and intimidation.
Nearly three years after Les Moonves was tossed off his perch at CBS over allegations of sexual misconduct, the onetime corporate powerhouse has finally settled disputes over his $120 million exit package with the Sheri Redstone-controlled company.
In May of 2021, Moonves and CBS have settled a separate suit about his $120 million severance that had been in escrow but reverted back to the company.
CBS merged with Viacom at the end of 2019. ViacomCBS was recently renamed Paramount Global earlier.
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