Disney Has A History Of Messy Executive Changes

Earlier this week, Walt Disney Co DIS announced that COO Thomas Staggs will be stepping down as of May 6. Investors are hoping for a smooth transition, but Disney has a history of messy executive changes.

Back in 1994, Walt Disney Studios chairman Jeffrey Katzenberg reportedly left the company after a 10-year tenure due to a dispute with then-CEO Michael Eisner. Katzenberg then proceeded to sue Disney for money he felt he was owed and eventually settled out of court for $250 million.

In 1997, Michael Ovitz was dismissed from his position as President of Disney after less that two years on the job. Despite the short tenure, Orvitz was granted a severance package valued at $38 million in cash and $100 million in stock. The huge severance package later became the centerpiece of a shareholder lawsuit against Disney.

Even Michael Eisner himself had a controversial departure from Disney. During Disney’s 2004 annual shareholder meeting, 43 percent of shareholders withheld their proxies to re-elect Eisner to the board of directors. The board was forced to turn over Eisner’s position to new chairman George Mitchell, and Eisner stepped down as CEO a year later.

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Disney’s announcement of the departure of Staggs came as quite a surprise to many shareholders who had viewed Staggs as the heir apparent to current CEO Bob Iger. Reuters is reporting that Disney may have decided that the next CEO needs to have more experience in technology to help address the shift in entertainment from traditional TV to streaming.

This potential focus on technology could mean that Facebook Inc FB COO and Disney board member Sheryl Sandberg is now a leading candidate to become Disney’s next CEO.

Disclosure: the author holds no position in the stocks mentioned.