CBS Shareholder Lawsuit Says Company Should Have Addressed Sexual Misconduct

A man has filed a CBS shareholder lawsuit on behalf of himself and other shareholders over the sexual misconduct allegations at CBS, particularly those raised against former CBS Chairman and CEO Les Moonves.

Plaintiff Gene Samit filed this federal securities class action seeking to represent shareholders who purchased CBS securities between Feb. 14, 2014 and July  27, 2018. The CBS shareholder lawsuit alleges the members of the board of directors at CBS failed to hold Moonves accountable for his actions despite knowing he “engaged in widespread workplace sexual harassment at CBS.”

CBS Shareholder Lawsuit Allegations

The board of directors at the company are voted into their positions by the shareholders, who are part-owners of a company in which they own stock. The board of directors is trusted to oversee the company’s operations and are accountable to the shareholders.

According to the CBS shareholder lawsuit, CBS did not enforce its own policies, or the alleged misconduct would have been prevented. By failing to address the conduct of Moonves, Samit claims, CBS made public statements that “were materially false and misleading at all relevant times.”

Allegations of sexual misconduct by longtime CBS executives, including Moonves, could go back as far as the 1980s. CBS is looking into reports that women were forcibly physically touched, verbally harassed, and threatened with career-ending repercussions if they didn’t cooperate. CBS allegedly ignored the behavior and continued to promote alleged offenders.

Charlie Rose, a former host and executive producer at CBS, had his employment at CBS terminated in 2017 over sexual harassment allegations. This past month, 60 Minutes Executive Producer Jeff Fager was terminated from CBS for allegedly sending a text message threatening the job of a reporter who was investigating sexual misconduct allegations against both Fager and Moonves.

The CBS shareholder lawsuit alleges that CBS feared the legal liability and the possibility of impeding its own business strategy if the allegations against Moonves became public.

Samit says that upon release of the news that the article about sexual conduct by Moonves and other company executives would be published, the stock for CBS Corporation fell $3.52 (6.12 percent) to close at $54.01 on July 27, 2018.

The CBS shareholder lawsuit alleges that because of the company’s “wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class Members have suffered significant losses and damages.”

The starting date of the proposed class period is based on the date that CBS adopted standards for conduct and ethical behavior that included no tolerance for sexual harassment. The end date of the class period is the day multiple media rumblings began that The New Yorker was going to release an article that included statements from six women who accused Les Moonves of sexual assault or sexual harassment.

If you are a CBS shareholder whose CBS stock went down when the media executive’s sexual misconduct allegations became public July 27, you could be eligible to participate in this CBS shareholder lawsuit investigation.

The CBS Shareholder Lawsuit is Gene Samit, et al., v. CBS Corporation, Leslie Moonves, and Joseph R. Ianniello, Case No. 1:18-cv-07796, in the U.S. District Court for the Southern District of New York.

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Current CBS shareholders, especially those who have held shares for four years or more, may be eligible for compensation if their stocks took a hit around the time the Les Moonves sexual misconduct allegations were made public.

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