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Eisner Foes Demand Voter Data

Former directors want to know how Disney's rank-and-file employees cast their ballots in a referendum on the CEO.

March 25, 2004|James Bates | Times Staff Writer

Dissidents on Wednesday stepped up pressure on Walt Disney Co. to release what they believe will be embarrassing data showing how rank-and-file employees voted earlier this month in a larger shareholder referendum on Chief Executive Michael Eisner.

Lawyer David K. Robbins, who represents former directors Roy E. Disney and Stanley P. Gold in their bid to oust Eisner, said in a letter to Disney representatives that the percentage of employee-held shares withheld during a protest vote on Eisner's reelection as a director was "rumored to be in excess of 70%."

At issue are about 28 million Disney shares held in a 401(k) retirement plan administered by Fidelity Investments. The shares are those invested directly, and do not include investments in mutual fund alternatives that also may hold Disney shares.

In a return letter, Disney lawyer Donald J. Wolfe fired back at Robbins: "Your sole objective at this point is to manufacture artificial controversy."

Wolfe said Disney was providing "an unprecedented level of access to voting information" to the group. He also suggested that the vote wouldn't represent a wide sampling of active workers because only about 22,200 of the company's 112,000-person workforce participate in the plan. Given the traditionally low voting levels of 401(k) participants, he said, "your inquiry in all likelihood relates to fewer than 10,000 voters, only a portion of whom would be active employees."

Robbins didn't cite his sources for the 70% figure in the letter, which was made public by Gold and Roy Disney. But Dan Burch, their proxy solicitor, said in an interview that the estimate was based on extensive polling of employees of the Burbank entertainment company.

In his letter, Robbins said his understanding was that Disney has said it did not know how the employees voted. But, he said, Fidelity had told the Gold and Disney team that it provided the breakdown to the company.

Meanwhile, Disney officials continued efforts to win back state pension funds that are sympathetic to Gold and Disney. They met earlier this week, for instance, with Pennsylvania Gov. Ed Rendell, who issued a personal vote of confidence in the company.

Rendell press secretary Kate Philips confirmed that Eisner spoke with the governor for about 20 minutes on the telephone Tuesday, while Disney's chief lobbyist, Preston Padden, paid a visit to the governor's residence in Harrisburg. Philips said that Rendell and Eisner knew each other from Rendell's days as chairman of the Democratic National Committee.

About 2.75 million shares held in pension funds for Pennsylvania employees and teachers were withheld from Eisner at the annual meeting. After the vote was announced, Treasurer Barbara Hafer made some especially stinging comments about Eisner's performance.

After the talk with Eisner, Philips said, Rendell said the pension boards "should concern themselves with earnings and recent performance and, by that measure, Disney has done a good job recently."

Earlier this month, an unprecedented 43% of the shares voted at Disney's annual meeting were withheld as a protest from Eisner. That vote followed a campaign by Gold and Roy Disney, who argued that the company's long-term stock price and earnings had suffered under Eisner. The company and its directors counter that Eisner has turned things around and that earnings will continue to surge.

Disney's board responded to the vote by stripping Eisner of his chairman title. But Gold and Disney argue that isn't enough.

Separately, Comcast Corp. Chief Executive Brian L. Roberts said Wednesday that "some facts would have to change" before his company would consider raising its unsolicited bid for Disney.

Roberts told reporters after a speech at the Boston College Chief Executives' Club that Comcast would wait to see "in the fullness of time where the market settles out."

Associated Press was used in compiling this report.

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