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CBS hit with shareholder lawsuit over CEO Leslie Moonves' alleged sexual misconduct

CBS hit with shareholder lawsuit over CEO Leslie Moonves' alleged sexual misconduct
A shareholder lawsuit contends that alleged misconduct by CBS Chief Executive Leslie Moonves has hurt investors. Moonves is shown in 2013. (Jordan Strauss / Invision/Associated Press)

A New York law firm filed a class-action complaint against CBS Corp. on Monday, alleging shareholders have suffered as a result of allegations of sexual misconduct by Chief Executive Leslie Moonves.

CBS shares plunged 6% on July 27, the day that the New Yorker published an explosive report that included accusations of six women who alleged that Moonves had sexually harassed them decades ago. CBS’ stock is down 9% this year and closed Monday, up 1%, to $53.66.

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CBS board members earlier this month hired two high-powered lawyers and former federal prosecutors — Mary Jo White and Nancy Kestenbaum — to investigate allegations of inappropriate behavior by Moonves as well as the workplace culture at CBS Corp. That review is ongoing.

New York law firm Pomerantz filed the class action suit in U.S. District Court in New York on behalf of Gene R. Samit and other CBS shareholders. Samit, according to the complaint, purchased his CBS shares at “artificially inflated prices.” Samit bought 200 shares of CBS stock last September at $59.45, according to the suit.

His complaint alleges CBS’ senior executives, including Moonves and Chief Financial Officer Joseph Ianniello, “made false and/or misleading statements” in Securities and Exchange Commission filings by failing to disclose that Moonves “had engaged in widespread workplace sexual harassment at CBS.” The suit also said CBS’ policies to prevent such misconduct were inadequate.

The suit seeks to represent holders of CBS shares from Feb. 14, 2014, through July 27.

CBS declined to comment.

Moonves, who has served as the company’s chief executive since 2006, has acknowledged, in a statement, “that there were times decades ago when I may have made some women uncomfortable by making advances. Those were mistakes, and I regret them immensely. But I always understood and respected – and abided by the principle – that ‘no’ means ‘no,’ and I have never misused my position to harm or hinder anyone’s career.”

Most of the alleged incidents occurred in the 1980s and 1990s. Late last year, as the #MeToo movement brought attention to sexual harassment, one woman told Los Angeles police detectives that Moonves had forced her to perform sex acts on two occasions when they worked together in the mid-1980s. County prosecutors declined to bring charges, saying the statute of limitations had expired.

The New Yorker report detailed the allegations of several other women, including actress Illeana Douglas, who reportedly said that Moonves “violently kissed her” during a meeting in his office in 1997, when Moonves ran CBS’ entertainment division.

The Samit lawsuit requests a jury trial and seeks unspecified damages and attorney fees.

1:25 p.m.: This article was updated to include CBS’ closing share price on Monday.

This article was originally published at 12:50 p.m.

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