GEORGETOWN, United States (AFP) - Disney chief Michael Eisner testified how he arranged for another board member to take former company president Michael Ovitz on a yacht trip to the Caribbean to be told he was fired.
Hostilities then broke out between the two erstwhile friends with Eisner considering Ovitz to have become "a wounded animal" as he negotiated a 140 million dollar severance package now the subject of the court battle.
Eisner gave new details of Ovitz's controversial departure on third day of his testimony defending a shareholder suit charging him, Ovitz, and Disney's 1995-1996 board of directors with wasting corporate assets.
Eisner said firing Ovitz had been one of the toughest decisions of his 20 years with the entertainment giant.
"People think because you make fuzzy cute little cartoons, that you are fuzzy and cute, and they try to take advantage of you," Eisner told the Delaware Chancery Court, saying that he had begun to regret making Ovitz president almost as soon as the appointment was made in 1995.
Eisner said he arranged with Disney board member Gary Wilson to take Ovitz, a former top Hollywood talent agent, on a yacht trip to the Caribbean for the Thanksgiving holiday in 1996. "This was how we figured out how to get rid of him."
Wilson reported back on December 1 however that Ovitz had taken the move badly. Eisner told how wrote notes from a conversation with Wilson describing Ovitz as "a wounded animal", a "loyal friend" who had become "a devastating enemy".
But under cross-examination by plaintiff's attorney Steven Schulman, Eisner continued to defend his decision to agree a no-fault termination with Ovitz 15 months after his appointment that allowed him to walk away with the severance package.
The suit, filed in Delaware because Disney is incorporated there, seeks the return to company of the payout to Ovitz, 60 million dollars in interest, plus legal fees and costs. The plaintiffs contend Ovitz should have been fired for gross negligence and forced to leave empty-handed.
The shareholders contend the defendants failed to investigate Ovitz's qualifications or his employment agreement when he was hired and later to determine independently whether he could have been fired for cause without compensation.
Though there was no formal vote of the board to decide a no-fault termination, Eisner said "no directors have been more full informed than our directors about Mr. Ovitz's performance."
"They had a lot of data and would be totally prepared for whatever ensued," he said.
Asked by Schulman if Ovitz voted on his own no-fault termination package Eisner said: "This wasn't up to him to accept or reject. It was just up to him to pack his bags.
"I was not trying to get his consent on being fired," he said. "I was trying to get his consent on leaving the company in a graceful way." He said Ovitz only received what had been agreed in his contract.
The trial began on October 20 and is projected to run into mid-December.
Ovitz, who as co-founder of Creative Artists talent agency was once dubbed "The Most Powerful Man in Hollywood," said in his testimony last month that deals he proposed for Disney were aborted by Eisner, and that he felt Eisner had stabbed him in the back by letting senior Disney executives undermine him.
11/18/2004 - 07:44 GMT - AFP