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'Queen of E!' May See Early End to Hollywood Story

Complaints against CEO Mindy Herman include abuse of power and undignified behavior.

May 27, 2004|Sallie Hofmeister | Times Staff Writer

Entertainment executive Mindy Herman seems a ripe subject these days for her cable channel's own trademark show, "E! True Hollywood Story."

As soon as today, Herman's four-year reign as chief executive of E! Networks could come to an abrupt but lucrative end, according to well-placed sources. Among other things, she has been accused of abusing her power and behaving in decidedly undignified ways, including brawling in the parking lot of a Hollywood burlesque club.

Although Herman has raised the profile and profitability of the celebrity-driven channel, she also has accumulated numerous detractors among rank-and-file employees, who complained that she created a fearful climate through firings and heavy- handed management.

An E! spokeswoman said Herman, 42, has acted appropriately throughout her tenure. Sources said Comcast Corp. and Walt Disney Co., co-owners of E! Networks, had signed off on a $20-million severance package. Her departure would not occur until she approves of the terms, expected to be presented to her today. The two media giants declined to comment on why Herman might be leaving six months before her contract expires.

Hollywood executives have long been known to be among the most coddled in the business world, often expecting to be treated like stars themselves. In Herman's case, however, more than a dozen sources in and out of the channel said she craved pampering to an extreme and, on occasion, used company resources to facilitate her aspirations.

Herman's potential undoing resulted in part from two anonymous letters sent to Disney and Comcast last fall, prompting an investigation and a subsequent audit. Comcast declined to comment on the investigation, and Disney said Wednesday that as a minority partner in the company it did not have authority over personnel, programming and day-to-day operations.

One of the letters, a copy of which was obtained by The Times, had a pleading tone. "It is desperation time here at E!" it said. "I pray that you will not turn a deaf ear."

The letter described two lavish baby showers it claimed that Herman threw for herself last fall at company expense. One, held at E!'s headquarters on Wilshire Boulevard, was "the single most expensive company party ever," according to the letter.

Sources said e-mails distributed at work by Herman's colleagues regularly informed employees about the details of Herman's baby registry and where to bring gifts.

"Everyone knew the implications of the e-mail -- buy her something nice or risk losing your job," stated the anonymous letter. "So we all spent money we didn't have to appease her."

The other baby shower was convened for about 30 friends and family members at the upscale Geoffrey's restaurant, located on a Malibu bluff.

A spokeswoman for E! said Herman reimbursed the company nearly $8,000 for the office shower after learning of the anonymous complaint. The spokeswoman said Herman's friends paid for the Geoffrey's event.

The anonymous writer also questioned the appropriateness of Herman making herself the recipient of an expensive room remodeling on the E! show "Guess Who's Coming to Decorate."

The program's concept is to surprise a homeowner with a $2,000 face-lift for a room in his or her home, a project orchestrated by an old friend. Herman, who appeared in the show that aired in January, had a bedroom in her Malibu home transformed into a nursery for her newborn. It was decorated in an underwater motif, with fabric sea creatures attached to the wall with Velcro, a lampshade that looked like an amoeba and a new crib.

The show's host described Herman as "a media mogul," "bigwig" and "one of the most powerful women in Hollywood."

Herman's decorating requests, sources said, pushed the cost thousands of dollars beyond the $2,000 budget.

An E! spokeswoman said Comcast had approved the show.

The anonymous letter also discussed an E! party for the premiere of the channel's "The Anna Nicole Show" at a Hollywood burlesque club, 40 Deuce. According to multiple witnesses interviewed by The Times, Herman became engaged in "hand-to-hand combat" in the parking lot with another woman. The witnesses said they did not know what prompted the fight.

The witnesses and other former and current employees of E! Networks spoke only on the condition that they remain anonymous. Some of the employees who were let go signed agreements that they would not speak badly of the channel or its management as part of their severance packages. Others, still employed by E!, said they feared their jobs would be in danger.

Herman took the helm of E! in 2000 and by all accounts promptly brought a new focus and intensity to the channel, which was long known for a collegial, easygoing work environment.

Among other things, she stepped up the daily dose of tabloid-style celebrity news and gossip by launching programs such as "Celebrities Uncensored." Herman also expanded the reach of its sister channel, Style, from 6 million subscribers to more than 40 million.

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