Ex-Sony CEO Faces Suit by World Online

Former Sony Corp. of America Chief Executive Michael Schulhof is being sued by World Online International of the Netherlands, an Internet service company he chaired until being fired Jan. 11.

The lawsuit, filed Friday in Manhattan by World Online and its majority holders, claims that Schulhof and a company he controlled tried to steal business from World Online and that Schulhof used his World Online credit card to pay for a prostitute. The suit also said he made inappropriate comments to the company’s investment bankers about sex clubs and prostitutes.

Schulhof and Ochill Investments also are being sued in Amsterdam, said John Goldman of Herrick Feinstein, attorneys for the plaintiffs.

World Online’s biggest shareholder, Rotonde, a subsidiary of Sandoz Family Foundation, is expected to file another suit in Amsterdam on Monday seeking $1.9 million it paid to Ochill, Goldman said.

The suit filed in the New York state Supreme Court alleges Schulhof took $1.9 million, then refused to sign a mandatory agreement. Schulhof also tried to transfer World Online shares without the consent of 75% of the company’s shareholders, the suit said.

Two other World Online shareholders filed the suit with Rotonde.

They are seeking $20 million for Schulhof’s alleged violation of a shareholder agreement, $20 million for alleged violation of his fiduciary duty and $20 million for alleged diversion of corporate opportunity.

Schulhof couldn’t immediately be reached for comment. Schulhof resigned from Sony in December 1995 after 20 years at the company. He left after the company wrote down its investment in Sony Pictures by $2.71 billion.

The Sandoz foundation paid $300 million in October for a controlling stake in World Online. The foundation is owned by heirs of the founding family of Sandoz, now part of Swiss drug maker Novartis.