Report: CBS CEO Les Moonves Accused Of Sexual Misconduct

CBS Corporation CBS plunged 7 percent Friday on reports of sexual misconduct allegations against CEO Leslie Moonves.

What Happened

Ronan Farrow, the journalist whose Harvey Weinstein investigation inspired the #MeToo movement that toppled executives across U.S. industries, authored a story set for publication in The New Yorker that accuses Moonves of unwanted kissing and touching more than 20 years ago, according to The Hollywood Reporter. 

The entertainment industry publication heralded the alleged exposé Friday morning but, as of 2:45 p.m. Friday, Farrow's anticipated story had yet to be published. 

CBS directors said in a statement they were looking into the accusations: "All allegations of personal misconduct are to be taken seriously. The Independent Directors of CBS have committed to investigating claims that violate the company's clear policies in that regard.”

Why It’s Important

If true, the allegations could prompt Moonves’ termination. CBS fired Charlie Rose and a number of other companies have recently axed executives on similar reports.

The potential loss of Moonves could prove critical to CBS, which became the most-watched network under his reign and remained there for nine consecutive years. The CEO led a network turnaround with shows like “CSI: Crime Scene Investigation” and the launching of streaming service CBS All Access.

The fallout of the Farrow report could also include organizational changes. Specifically, it could affect the outcome of a lawsuit Moonves and CBS filed against parent company National Amusements to prevent a merger with National Amusements’ Viacom, Inc. VIAB. Viacom popped 5.7 percent on Friday’s news and continued higher at the time of publication.

What’s Next

The CBS board said it will “take appropriate action” following its investigation — and in the meantime, it will continue its legal battle with National Amusements.

“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,” CBS said in a statement.

“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.”

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