Yahoo! director! bows! out! after! CEO! CV! blunder!
Board sets up three-man team to investigate Thompson
The Yahoo! director who led the search for CEO Scott Thompson has said she won't be standing for re-election to the board as a new committee is appointed to look into his padded CV.
Patti Hart, whose educational background also had a discrepancy revealed by activist investor Third Point, said that "after careful consideration" she wouldn't be staying with the board after the next annual meeting and would instead be concentrating on her role as chief of International Game Technology (IGT).
"It has been my privilege to serve Yahoo! stockholders and I remain confident in the company's future," she said in a canned statement. "However, my primary responsibilities are to serve as CEO of IGT and to eliminate activities that may interfere with my ability to carry out my commitments to IGT."
The chairman of the board at IGT, which makes electronic gaming machines, said that company was standing behind Hart.
"After a thorough review, the IGT board of directors has found no material inconsistencies in Patti Hart's academic credentials," Philip Satre said.
"We believe her service as a member of Yahoo!'s board of directors could become a distraction from her responsibilities to IGT. We have asked Patti not to seek re-election to the Yahoo! board and we will closely monitor future developments at Yahoo! and their impact on Patti's responsibilities to IGT."
At the same time as Third Point revealed that Yahoo! CEO Scott Thompson doesn't hold a degree in computer science – despite filings with the Securities and Exchange Commission claiming that he did – the investment firm also said that Hart had been attributed a degree in marketing and economics, when her degree was actually in business administration.
Hart headed up the search committee that appointed Thompson CEO and Third Point said last week that both of them owed Yahoo! an explanation for the mistakes in their records.
Yahoo! said that it was undertaking a review of the situation and today announced a three-person committee to look into the situation.
"The board of directors of Yahoo! today announced that it has formed a special committee to conduct a thorough review of CEO Scott Thompson's academic credentials, as well as the facts and circumstances related to the review and disclosure of those credentials in connection with Thompson's appointment as CEO," the company said in a canned statement.
The web firm has chosen Alfred Amoroso, a director who joined the board in February, and John Hayes and Thomas McInerney, who both joined in April, for the committee, which has also brought on law firm BirdMarella as its independent counsel.
"The special committee and the entire board appreciate the urgency of the situation and the special committee will therefore conduct the review in an independent, thorough and expeditious manner," Yahoo! said.
"The board intends to make the appropriate disclosures to shareholders promptly upon completion of the review."
CEO Scott Thompson has only been in the saddle at the ailing company since the start of January amid a turbulent time at the top at Yahoo! The firm is trying to instigate a turnaround in its fortunes, but soap opera dramatics surrounding the firing and hiring of CEOs and board members are not inspiring a lot of confidence.
Third Point, which along with its chief Daniel Loeb has been agitating for thorough changes at the company, is once again trying to get some of its chosen leaders onto the board, after its last attempt was foiled.
The investment firm's previous choices, which included Loeb, were rejected in favour of board members including the three directors who make up the special committee.
"We believe the decision to reject Third Point’s nominees was pretextual and not made in good faith," Third Point said on Monday. "It appears the nominating committee would rather recommend an individual to the Yahoo! board who submitted a false resume than the highly qualified individuals nominated by Third Point.
"The failure to detect the easily discoverable inaccuracies in Mr Thompson's resume creates significant doubt as to the thoroughness of the entire board nomination process and, ultimately, the suitability of Messrs Liguori, Hayes, McInerney, Webb and Amoroso to serve on the board."
The firm is once more recommending that shareholders help it to get Loeb; Harry Wilson, CEO of corporate restructuring house MAEVA Group; Michael Wolf, CEO of Activate; and Jeffrey Zucker, former CEO of NBC Universal, onto the board. ®