CBS Hires Ex-Prosecutor, SEC Chair to Probe CEO Allegations

(Bloomberg) -- CBS Corp. hired two law firms to investigate sexual harassment allegations against Chief Executive Officer Leslie Moonves and formed an internal panel of board members to help with the probe.

Former federal prosecutor Nancy Kestenbaum of Covington & Burling and Mary Jo White, former Securities and Exchange Commission chairman, of Debevoise & Plimpton will lead the inquiry, CBS said Wednesday in a statement. The CBS board committee comprises Bruce Gordon, Linda Griego and Robert Klieger.

Kestenbaum and White are set to “conduct a full investigation of the allegations in recent press reports about Chairman and CEO Leslie Moonves, CBS News and cultural issues at all levels of CBS,” the network said in the statement.

Several women have accused Moonves of misconduct including forced touching and kissing during business meetings, allegations that come just as the CEO is locked in a battle for control of the network with Vice Chairman Shari Redstone, heir to 95-year-old media mogul and key shareholder Sumner Redstone.

The board found out months ago, before a New Yorker story was published, that the Los Angeles Police Department had investigated a sexual assault complaint against Moonves, the Los Angeles Times reported Thursday. Prosecutors didn't file charges because the alleged incidents were in the 1980s, past the statute of limitations, the newspaper said. To look into the matter, the board hired a law firm, which concluded that the allegations didn't require further investigation, the Times said.

The internal panel formed Thursday includes board members with ties to each side of the Moonves-Redstone battle. Gordon and Griego have served on the CBS board for more than a decade, and supported Moonves in his bid to dilute the Redstone family's controlling stake in the company. Klieger, a partner at a Los Angeles law firm, joined the CBS board last year. He has worked as an attorney for the Redstone family.

The attorneys leading the probe both have track records in performing complex investigations. Kestenbaum led an inquiry last year into allegations of decades of sexual abuse at the Connecticut prep school Choate Rosemary Hall, reviewing more than 23,000 pages of documents and interviewing more than 100 people, according to the Washington Post. White, who led the successful prosecution of John Gotti in 1992, has worked on investigations for the National Football League into misconduct allegations against Dallas Cowboys star Ezekiel Elliott and former Carolina Panthers owner Jerry Richardson.

The women who accused Moonves of misconduct said they were physically intimidated and that their careers suffered when they refused his advances. The claims came to light in a New Yorker magazine article published July 27 that also described a culture of harassment at CBS.

Moonves has acknowledged there were times decades ago that he may have made some women uncomfortable, but said he never used his position to harm anyone's career.

Moonves, 68, who's led the company since 2006, has been a major force in TV since the 1980s. CBS has led audience ratings for most of the past decade based on a broad slate of comedies, procedural shows like “CSI'' and live sports.

Moonves has clashed repeatedly in recent years with Shari Redstone over the prospect of combining CBS with parent Viacom Inc. The vice chairman has advocated a merger to help boost flagging Viacom, and wanted Moonves to run the joined company. Moonves opposed the idea, believing Viacom's best days are behind it.

CBS shares were little changed, falling 0.1 percent to $52.49 at 9:32 a.m. in New York. The stock had declined 11 percent this year through Wednesday's close.

The company is scheduled to report second-quarter results after markets close.

To contact the reporter on this story: Lucas Shaw in Los Angeles at lshaw31@bloomberg.net

To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, ;Crayton Harrison at tharrison5@bloomberg.net, Lisa Wolfson

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