Weinstein Company executives and its board of directors are under renewed scrutiny for failing to stop Harvey Weinstein’s sexual misconduct in the new lawsuit filed on Sunday against the company by New York Attorney General Eric Schneiderman.
TWC executives are not named as defendants in the suit — except for Harvey and Bob Weinstein — but the complaint details multiple instances when senior management did not react to allegations of abusive behavior. The company’s Human Resources department is singled out multiple times for not launching any formal investigation into charges against Weinstein.
The scrutiny could complicate attempts to close the pending sale of The Weinstein Company to an investor group led by former Obama Small Business Administrator Maria Contreras-Sweet.
Though he is not directly named, TWC COO David Glasser’s role is called out in this lawsuit, creating a potential sticking point. As part of the group’s $500 million deal, which was expected to be completed on Sunday, Glasser was set to become the new CEO of the company to ease transition under the new management group. Contreras-Sweet, along with billionaire Ron Burkle, was expected to overhaul the company and give it a new name and a female-majority board of directors.
In a statement from Schneiderman’s office announcing the lawsuit, it is noted that complaints filed by TWC employees against Weinstein were not handled by the H.R. department, but by “the COO [Glasser] and other members of TWC senior management, as well as counsel retained to contact victims of misconduct.” Glasser has been with TWC since 2008, and was often regarded as one of Weinstein’s closest partners in running the company along with his brother, Bob Weinstein.
The lawsuit could also spell trouble for former members of TWC’s board of directors, many of whom resigned in the days following the New York Times’ report on Weinstein’s sexual harassment back in October. The lawsuit claims that the majority of the TWC board refused to back efforts to obtain Weinstein’s personnel file after complaints against him were filed.
Update: In a statement released to TheWrap, the board stated, “We are disappointed that the New York Attorney General felt it necessary to file today’s complaint. Many of the allegations relating to the Board are inaccurate and the Board looks forward to bringing the facts to light as part of its ongoing commitment to resolve this difficult situation in the most appropriate way. With respect to the Company’s ongoing sale process, the Board sought a transaction to preserve jobs and create a victim fund. Any suggestion that the Company or its Board somehow impeded or discouraged the buyer’s access to the New York Attorney General is simply untrue. Indeed, the Company and its Board actively encouraged the buyer to communicate with the Attorney General. The Company looks forward to continuing our discussions with the Attorney General in order to reach our common goal of bringing this situation to an appropriate resolution.”
Board minutes also show that the board of directors also unanimously ratified Weinstein’s contract extension prior to this past October, including a provision that enforced financial penalties against Weinstein in increments of $250,000 for every time he had to make a settlement to satisfy a claim of misconduct and harassment in violation of the company’s code of conduct.
“Thus, pursuant to [Weinstein]’s employment contract,” read the AG’s statement, “[Weinstein] could continue engaging in sexual harassment and misconduct with impunity, provided that he paid the costs of any settlements and that he avoided disclosure of misconduct that might risk causing ‘serious harm to the company.’”
In addition to Glasser and Bob and Harvey Weinstein, the TWC board at the time of Weinstein’s dismissal last fall included Lance Maerov, SVP of corporate development at WPP Group USA; Tim Sarnoff, Deputy CEO at Technicolor; Marc Lasry, owner of Milwaukee Bucks and CEO of Avenue Capital Group; Tarak Ben Ammar, owner of French distributor Quinta Communications; Paul Tudor Jones, founder of The Tudor Group; and Dirk Ziff, managing partner at Ziff Capital Partners, the owner of World Surf League and also serves on the board of the Rock and Roll Hall of Fame.
Ben Brafman, attorney for Harvey Weinstein responded Sunday, saying in a statement: “We believe that a fair investigation by Mr. Schneiderman will demonstrate that many of the allegations against Harvey Weinstein are without merit. While Mr. Weinstein’s behavior was not without fault, there certainly was no criminality, and at the end of the inquiry it will be clear that Harvey Weinstein promoted more women to key executive positions than any other industry leader and there was zero discrimination at either Miramax or TWC.”
He continued, “If the purpose of the inquiry is to encourage reform throughout the film industry, Mr. Weinstein will embrace the investigation. If the purpose however is to scapegoat Mr. Weinstein, he will vigorously defend himself.”