Eisner to Linger on at Disney

Published December 14, 2004

By C. W. Oberleitner

Michael Eisner, CEO of the Walt Disney Company (WDC), has told employees of the company that he plans to remain an active member of the board after his current contract expires. Backing away from comments he offered the media in September, Eisner went on to say he may seek a more active role in the creative elements of the Disney Company.

On Friday, December 3, Walt Disney Company CEO Michael Eisner attended an "ABC All-Hands" meeting. At the meeting, Disney Company employees asked about his future plans.

In what has been described as a humorous tone, Eisner told those present that his remarks were "off the record." Nevertheless, a controversial (see today's column by C. W. Oberleitner, What Up at SaveDisney.com?), first-person account of his response at the ABC All-Hands meeting appeared, December 6, on the message boards of AnimationNation.com. Later that same day on the front page of SaveDisney.com, in a letter to supporters titled Promises, Promises…, Roy Disney quoted the post from AnimationNation.com's message boards.

Following is the SaveDisney.com quote of the original posting from AnimationNation.com's messages boards (the original posting appeared in the General Discussion forum under the topic heading "Save Disney ends Efforts??"):

...Michael Eisner spoke at the ABC 'all-hands' meeting on Friday, and someone asked what his plans were after his contract expired, and where he'd go. He basically said while his position would end, he would remain an active member of the board of directors, and perhaps be able to have a more active role in some of the creative elements of the company.

...And while he joked that everything he said at this all-hands presentation was 'off-the-record' he openly bragged about how both the Comcast take-over bids and the 'letters to the shareholders,' including the bid by the California 401(k) mutual fund that I can't remember which had wanted to oust him, had all been 'defeated.' It seemed to me that, from his perspective, he was stronger and more empowered than ever.

Stop Loss

The original posting of the preceding statement on AnimationNation.com's message boards and all references to the Disney employee credited with the first-person account of Eisner's remarks have been removed from the message boards. According to sources familiar with AnimationNation.com's operations, this was done to protect the identity of the employee in question.

[After speaking with this Disney employee, we too, out of concern for their livelihood, have agreed to withhold the identity of this individual.—Editor]

By December 7, Roy Disney's Promises, Promises… letter to supporters on SaveDisney.com had also been modified. All references to the first-person account of Eisner's remarks had been removed from Disney's letter. However, regular SaveDisney.com contributor Merlin Jones posted the original text of Disney's letter, with the quote about Eisner's remarks, to the "Save Disney ends Efforts??" message board thread on AnimationNation.com, where, as of press time, it remains.

[A copy of the original text of Roy Disney's Promises, Promises… letter to supporters follows this story.]

Nevertheless True

Despite the controversy surrounding the origin of the original account of Eisner's remarks, it has been confirmed by others in attendance at the ABC All-Hands meeting that Eisner did, in fact, make the statements attributed to him that first appeared on AnimationNation.com's message boards and later in Roy Disney's Promises, Promises… letter to supporters at SaveDisney.com.

Eisner's remarks at this meeting appear to contradict statements the Mouse House CEO made to the press last September when he said,

I have not asked the board to stay on the board or be chairman after the end of my contract. My assumption is that I would not continue on the board as chairman…

Disney Company spokesman John Spelich did not return phone calls seeking comment regarding Eisner's remarks. Likewise, Shamrock Holdings' (home of SaveDisney.com) spokesman Cliff Miller also did not return phone calls.

Representatives of Sitrick and Company, Shamrock Holdings' public relations firm, returned several phone calls but offered no comment.

The Disney employee, credited with first posting Eisner's remarks, would not comment regarding any aspect of the meeting or the posting of Eisner's remarks to AnimationNation.com's message boards.

Roy Disney's Original Promises, Promises… Letter

The following appeared on the front page of SaveDisney.com on December 6, 2004. It appeared above a graphic of Roy E. Disney's signature:

A Message from Roy E. Disney

Promises, Promises...

As you may have read by now, we will not be running an alternate slate or proxy battle at the next annual meeting.

We've received tons of letters and emails from SaveDisney supporters expressing disappointment and concern. Others have posted their thoughts on message boards around the Net. Many have asked, "Is this the end of SaveDisney's efforts?" "Have you given up?" "Have you thrown in the towel?"

Now that the deadline has passed to nominate new Directors to the Disney Board--and along with it the legal necessity to keep our opinions to ourselves--We're once again free to say what we think on these pages.

And the first thing we need to say is: This war is only beginning. It is only the start of a new phase. SaveDisney will not go away.

Remember that the Disney Board of Directors actually has promised--and we emphasize the word "promised"--to do what we pressed them to do: get rid of Eisner, and bring in a new CEO...and do it by mid-2005. We intend to hold them to their promises.

Do we trust them to keep these promises? No, no, no... It would be a first for them. Remember, these are promises the Board would never have made unless SaveDisney had held them to the fire in the first place. Without us, inertia would be their only response.

Already there is some cause for concern, as we have read the following rumor, posted on a message board at another site:

"...Michael Eisner spoke at the ABC 'all-hands' meeting on Friday, and someone asked what his plans were after his contract expired, and where he'd go. He basically said while his position would end, he would remain an active member of the board of directors, and perhaps be able to have a more active role in some of the creative elements of the company."

"...And while he joked that everything he said at this all-hands presentation was 'off-the-record' he openly bragged about how both the Comcast take-over bids and the 'letters to the shareholders,' including the bid by the California 401(k) mutual fund that I can't remember which had wanted to oust him, had all been 'defeated.' It seemed to me that, from his perspective, he was stronger and more empowered than ever."

If true, this rumor is further evidence that, without constant pressure from us and from all of you, the shareholders, CMs, and the public in general - Eisner may not leave, ever. It is our belief that his plan has always been to get Bob Iger elected CEO so he can stay on the Board as a puppeteer--the Stromboli, if you will--behind the scenes. We will all be asked to "ignore that man behind the curtain."

This outcome would clearly be unacceptable to everyone associated with SaveDisney...much less to the good of the Disney Company itself.

But... With the stock price up in the short term and promises to select a new CEO on the table, we were convincingly advised--by many--that proxy support would not favor us at this time.

So for now, we must wait and see. This is a time when discretion is the better part of valor. It is a time for patience. They have set their own deadline. It is not so far off--and if they do not hold themselves to it, they know what the consequences will be- from us--and from all of you.

This is not just a "Roy and Stanley" movement... it is the will of millions of people who will not go away either.

It is our intention to do everything in our power to make sure each of the individual directors hear our point-of-view on what is happening -- and has happened -- to the Disney Company, and that they take heed of what we have to say.

So don't give up hope. We haven't, and we won't. In the end, the only person throwing in a towel will be Michael Eisner.

Various o-meon.com staff writers contributed to this story.

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Former Vice Chairman and director of the Walt Disney Company, Roy E. Disney.