Time Warner Director Quits Bank’s Board

Time Warner Inc. won a small victory Tuesday in its intensifying battle with investor Carl Icahn when one of the company’s directors quit the board of Icahn’s investment banker.

Robert Clark resigned as a director of Lazard Ltd. a week after the potential conflict emerged when Icahn retained the firm. Icahn is seeking to split up the entertainment giant.

Clark, a former dean of Harvard Law School, said he was stepping down to “eliminate the appearance of a conflict of interest” from serving on both boards, according to a regulatory filing.

Icahn, who has blamed Time Warner’s management for its stagnant stock price, is proposing that the New York company spin off its cable systems and buy back stock. Icahn hopes to unseat a majority of Time Warner’s board with his own slate next spring.

At a briefing with the Los Angeles Times on Tuesday, and a later Town Hall Los Angeles luncheon, Time Warner Chief Richard Parsons took shots at Icahn’s efforts.

Parsons said the reason the financier hired Lazard was that his proposals for increasing the company’s stock price fell flat.

“If I thought any ideas he was offering created real value, I would have done them,” Parsons said.

Parsons said the media sector was out of favor at the moment because of its uncertain competitive standing in the digital era.

He said the trend toward consolidation that reshaped the media, automotive, pharmaceutical and banking industries was spurred by technological changes and by the need for scale to compete globally.

Parsons predicted that media rivals such as Viacom Inc. looking to buck those trends by breaking themselves up would not succeed.

“Before the ink dries on the paper, each of those entities will try to build themselves to their former strength,” he said.

Parsons said Time Warner’s scale helped its move into new media. It owns such assets as Warner Bros. studio, HBO, Time magazine, America Online and the nation’s No. 2 cable TV operator.

“I like our hand, our structure,” Parsons said. “We have a little bit of everything. You can shape how the future unfolds. We are prepared for whatever comes down the road.”

He declined to discuss reports that AOL was nearing agreement with Microsoft Corp. to create an online advertising service.

AOL has considered a partnership with Google Inc. or Microsoft to drive traffic to its Internet portal.