Former Walt Disney Co. directors Roy E. Disney and Stanley P. Gold can't prove the company's board misled investors about the thoroughness of its search for a successor to Chief Executive Michael Eisner, Disney lawyers said Wednesday.
Attorneys for Disney, the second-largest U.S. media company, made their argument while urging a Delaware judge to dismiss a lawsuit filed by the two former directors, which challenges the board vote that elevated company President Robert Iger to Eisner's post. They argued that Roy Disney and Gold couldn't show that board directors purposely mischaracterized their CEO search process as part of their effort to win reelection to the board.
"We're here today because the board designated Robert Iger as CEO and Roy Disney and Stanley Gold are unhappy with that outcome," Paul Rowe, a lawyer for Disney and its directors, told Delaware Chancery Court Chief Judge William B. Chandler III in Wilmington. "Common sense says we wouldn't be here if the board" had chosen someone else, Rowe said.
The suit renews hostilities between the Burbank-based company and Roy Disney and Gold, who last year waged a campaign to have Eisner fired. They later declared a truce when Eisner announced his plan to retire. The lawsuit was filed after Disney refused to provide the two former board members with information about the selection process.
Chandler deferred his ruling on the company's request to throw out the suit, saying he would hand down a decision "as promptly as I can."
In their suit, Roy Disney and Gold contended that the company and its board falsely promised an open, careful and thorough search for Eisner's successor while it secretly rigged the process in favor of Iger, the former head of the company's ABC TV unit. Iger is slated to succeed Eisner in September.