Settlements related to sexual harassment claims at Fox News Channel cost the cable network’s parent company $10 million in the first three months of 2017, the corporation said in a U.S. Securities and Exchange Commission filing Wednesday.
Fox made the disclosure as part of its earnings report for its fiscal third quarter, and said in the filing that it had received other inquiries related to the corporate culture of its large cable-news unit as well as stockholder requests to “inspect the books and records of the company,” which “could lead to future litigation.” Fox said it was unable to estimate what liability, if any, could result from those matters. But it said in the filing that it “does not currently anticipate that the ultimate resolution of any such pending matters will have a material adverse effect on its consolidated financial condition, future results of operations or liquidity.”
The revelation suggests scrutiny of Fox News Channel is not likely to cease in the near future. The cable-news operation, a large generator of operating profit for the parent, has been under a societal microscope since former Fox News anchor Gretchen Carlson last year filed a harassment lawsuit against former Fox News chief Roger Ailes that eventually resulted in his ouster. Ailes has denied all claims against him. The company said it has paid $45 million in total related to settlements since Ailes departed.
Since Carlson’s filing, revelations about harassment and discrimination at the unit have emerged with seeming regularity over a period of several months. In April. Fox News parted ways with its star anchor, Bill O’Reilly, after a New York Times report revealed he had paid settlements totaling $13 million to women who made claims of sexual harassment or inappropriate behavior against him. Meanwhile, Bill Shine, a Fox Business co-president who played an instrumental role at the network over many years, resigned earlier this month.
Several current and former employees of Fox News have filed other lawsuits against the network and some of its top executives that allege sexual harassment or discrimination was tolerated. Fox News has in recent weeks installed new senior female employees as chief financial officer, president of programming and president of advertising sales. The unit has also elevated a new human-resources chief to have more oversight over employee complaints and how they are handled.
Fox also cautioned investors that recent programming shifts at Fox News Channel in the wake of O’Reilly’s departure presented a potential risk. The shift in primetime “could have a negative impact on our ratings,” the company said. Generally speaking, the company’s new primetime lineup – “Tucker Carlson Tonight” at 8 p.m., “The Five” at 9 p.m. and “Hannity” at 10 p.m. – have fared well against competition. At the same time, MSNBC’s Rachel Maddow has seen her viewership surge in recent weeks, and the current news cycle has brought audiences to Fox News competitors. Last night, as viewers sought information about the firing of FBI chief James Comey by President Trump, MSNBC and CNN both attracted more viewers between 25 and 54 – the demographic most coveted by advertisers in news programming. Fox News programming continues to win more viewers overall than that featured by rivals.
In the filing, 21st Century Fox also said that it would have to pay a break-up fee of about $250 million if it did not obtain regulatory approval to purchase the remaining part of satellite-operator Sky that it does not own by August 15, 2018. The company has reported that figure in the past.