Glasser was set to become CEO of the company under a new ownership group. However, New York Attorney General Eric Schneiderman filed a suit on Sunday alleging that Glasser had failed to protect employees from Harvey Weinstein’s pattern of sexual harassment. In a press conference, Schneiderman made it clear that the sale would not have his blessing if Glasser were left in charge.
The company did not give any further explanation.
A source familiar with the board’s thinking said the firing came in response to the attorney general’s lawsuit. The board members blamed Glasser for failing to keep them in the loop about the investigation, and felt that he was playing both sides and angling for the top job under the new owners. The board also fired the law firm that had been handling the investigation on the company’s behalf.
The company is running low on cash, and is thought to be desperate to keep the sale alive. Investor Ron Burkle is part of the bid group, which is formally led by Maria Contreras-Sweet, the former head of the Small Business Administration. Burkle is believed to be close to Glasser, so it is unclear whether the bid group would cut ties with him as well.
With the attorney general’s intervention earlier in the week, the deal is on life support. Without it, the company likely would have to declare bankruptcy.
Getting rid of Glasser could help resolve some of the attorney general’s concerns. However, Schneiderman has also raised a doubt as to whether the company will have sufficient funds to pay off victims of Weinstein’s harassment.