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Mouse eyed Powell, Diller as big cheese

Eisner Testimony relates past Disney plan

NEW YORK — Michael Eisner said Wednesday he’d considered bringing outgoing Secretary of State Colin Powell to take a top job at Disney. Later, he asked his former boss at Paramount Barry Diller to join Disney. Eisner, half joking, said he’d offered to reprise their roles — with Diller as top dog and Eisner as No. 2.

“He said I was being silly,” said Eisner in his second full day of testimony in Delaware Chancery Court.

Eisner said he thinks he approached Powell in 1992, when Eisner’s deputy Frank Wells was still alive. Wells died in a helicopter crash in 1994.

“I read that was going to retire from the military. Somebody said to me, maybe Sandy (Litvack), ‘This is a great guy’ … If he could run the U.S. Army, I thought he could run the theme parks,” Eisner said. “I called him. I met him at the Pentagon. He made it clear he wanted to write books and do other things.”

Searching for an exec to fill Wells’ shoes, Eisner acknowledged he had few serious conversations with potential candidates. “I had a long list of names” but most people “were seriously engaged or were fairly longshots.”

He said he talked to Roger Enrico, who later became chairman of PepsiCo. Enrico was “great” but had a heart problem at the time. “The last thing the company needed was two people with a heart problem,” Eisner said.

Current Disney chairman George Mitchell was a serious candidate. But, Eisner said, “he felt just coming out of the Senate he didn’t have enough business experience, especially entertainment. I concurred.”

Shareholders who brought the lawsuit have accused Eisner and Disney’s board of a cursory search at best and for failing to properly vet Michael Ovitz, who was hired in the fall of 1995. They claim the board wasn’t responsibly engaged in the process of hiring Ovitz or constructing his generous employment contract.

Messy minutes

Eisner adamantly denies this, although he agreed there was sloppy record keeping at board meetings. Plaintiff’s lawyer Steven Schulman sought to show Wednesday that minutes of board meetings were often abbreviated, inaccurate or nonexistent. Eisner blamed Disney’s former corporate secretary.

“I wasn’t thrilled with the process of the corporate secretary. I don’t want to be too critical here, but my instinct was that we could be more organized here and we made some changes. Our corporate secretary wasn’t a lawyer — a very nice woman. … I thought she was sloppy actually … not up to the level I would have expected.”

When pressed on cross examination to come up with official documentation for certain meetings where Michael Ovitz was discussed — in particular one executive session of the board that wasn’t recorded in the minutes — Eisner said,” You either believe me or the others, or you don’t.”

Exit lines

In more verbal gymnastics, he testified that his last, most famous Ovitz memo from December ’96 — where he called his former president a ‘psychopath” and “incompetent” — was pure venting “based 98%” on Ovitz’s perceived backstabbing just after he was let go, and hardly at all on his behavior while he worked at Disney. Of course, any indication to the contrary would bolster another of the plaintiffs’ claims, that Ovitz could have been booted for good cause, sans a $140 million severance package.

Eisner said he stifled his anger in a gentlemanly exit press release where he praised Ovitz and sportingly agreed to include a vague reference to a consulting deal. He said he then learned Ovitz had hired Hollywood publicist Steven Rivers and rushed straightaway into a round of meetings with Viacom topper Sumner Redstone and other moguls touting the consulting gig and boasting he could deliver the Mouse’s radio stations or its publishing biz.

Eisner appeared frequently impatient with the admittedly tedious cross-examination that nonetheless managed to evoke a sense of massive disconnect — between Disney and Eisner’s steely resolve to fire Ovitz, and their tortured attempts to massage his exit.

Unemployment cruise

Eisner said Ovitz was “to understand that he was fired” during a four-day Caribbean cruise, expressly for that purpose, organized by former Disney board member Gary Wilson.

“Gary Wilson was going with the full knowledge of the board to tell Ovitz he was fired,” Eisner said.

“So Mr. Ovitz hadn’t accepted the firing?’ asked Schulman.

“It wasn’t up to him to accept it or not. It was up to him to pack his bags.”

“Why didn’t you throw him out?”

“I think it’s kind of bad form to have guards come and throw people out on the street. I was not trying to get his consent to leave the company. I was trying to get his consent to leaving the company in a graceful way.”

Parting gift

Eisner admitted he’d considered throwing Ovitz a 50th birthday party at about this time. And Disney’s board voted Ovitz a $7.5 million bonus after they’d already agreed to fire him.

Eisner insisted the bonus award was a mistake that was rescinded immediately. He said it was a coincidence that the bonus wasn’t formally revoked until an outcry after news of Ovitz’s departure had hit wires.

Eisner grew apoplectic recalling the immediate aftermath of Ovitz’s exit.

“I was about as mad as I’d ever been. … I had spent a year trying to educate him, and I thought I showed enormous patience. I tried to make him rise to the level I thought necessary to lead the Walt Disney Co. … Even with all the pain and agony he’d given me and the company, I tried to handle it in a dignified way, an elegant exit … you let someone leave under mutual agreement, even though that’s just a euphemism for being fired, which he was.”

Public scene

“Every reporter was now hearing about the great rip-off Ovitz was doing of the Disney company. I called him. … He admitted he hired the guy (Rivers) and that he couldn’t control him. … It was an incredible betrayal … not of a contract, not of a written agreement, but because I had bent over backward. And not because he was my friend. I would have done that for anyone. … And he just threw it right in the company’s face. I was reading every single day about what idiots we were.”

Combative cross-exam

The testimony was all over the map, at one point jumping back to Eisner’s youth. A combative Schulman, who referred to Eisner throughout as ‘sir,’ started to quibble over the exact year of Eisner’s very first job as a page at “The Price is Right.” The details in Eisner’ deposition differed every so slightly on that count from his testimony Wednesday.

Still, the trial continued to provide trenchant glimmers into Hollywood’s inner life, as Schulman prompted Eisner to recount a bizarre anecdote regarding a restaurant reservation between jobs.

Table talk

“I never had a problem getting a reservation at Morton’s when I was the president of Paramount. All of a sudden, they didn’t’ have seating until 9,” Eisner said.

“I called up Michael Ovitz to see if he could get himself in at 7:30. In that sense, he got a reservation for me. I didn’t go. I wanted to see if it was my position they were interested in.”

“So, Ovitz said he got you a reservation. Are you saying something different?” asked Schulman.

“He proudly said he was in and I was out.”

“Did he offer you that table, sir.”

“He did, but I didn’t go.”

(Pamela McClintock and Willa Paskin in New York contributed to this report.)

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