The financial fallout from the sexual harassment claims and lawsuits piling up at Fox News Channel made an appearance today in corporate filings submitted by parent 21st Century Fox. The price tag is at $45 million since Roger Ailes was canned last summer following numerous and explosive allegations of extremely inappropriate behavior.
“Other for the three and nine months ended March 31, 2017 included approximately $10 million and $45 million, respectively, of costs related to settlements of pending and potential litigations following the July 2016 resignation of the Chairman and CEO of Fox News Channel after a public complaint was filed containing allegations of sexual harassment,” said a section deep within the Quarterly Report (read it here) that 21st Century Fox submitted to the SEC on Wednesday. The total figure for the ‘Other’ category over the nine months that ended at the end of March is $71 million.
Fox Warns: Fox News Faces Inquiries And Possible Ratings Hit Following Harassment Charges
My colleague David Lieberman reported earlier today that 21st Century Fox also noted in its quarterly report that it has “received regulatory and investigative inquiries relating to these matters and stockholder demands to inspect the books and records of the Company which could lead to future litigation.” As civil suits from Fox News on-air talent, past and potential contributors and others swirl, prosecutors at the U.S. Attorney’s Office in Manhattan and criminal investigators from the U.S. Postal Inspection Service are looking into what went on at FNC in these matters, who was paid what, and where it ended up in the books.
“Due to the early stage of these matters, the amount of liability, if any, that may result from these or related matters cannot be estimated at this time,” the filing today goes on to say in bloodless corporate speak. “However, the Company 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 key word, as it has been for a while in this, being “anticipate” — that being what Fox has not been good at the past nine months.
At what Fox surely hoped was the end of the matter but really became the prologue in many ways, Ailes was shown the door by Rupert Murdoch and his sons James and Lachlan on July 21 last year soon after former Fox & Friends co-host Gretchen Carlson sued him for sexual harassment. Ailes was said to have received a $40 million golden goodbye from the Murdochs, which does not seem to be reflected in today’s filing. In September, Carlson came to a $20 million settlement with Fox and dropped her legal action. That payout is surely part of the $45 million noted in today’s filing.
21st Century Fox said Wednesday that it had no comment about the multimillion-dollar payouts beyond what was in the filing.
There have of course been several more such suits against Fox and Ailes in subsequent months, as well as the exit of ratings behemoth Bill O’Reilly last month after reports surfaced anew of the $13 million he and the company had paid out over the years to settle sexual harassment claims against the former host. The mushroom cloud of these matters also saw FNC co-president Bill Shine get the boot on May 1 and other execs leave or be pushed out.
All this comes as parent Fox is attempting to gain full control of Euro Pay TV giant Sky and is awaiting UK regulatory approval next month on a $14.4 billion deal struck in December. That process could be derailed as lawyers representing U.S. plaintiffs met with Ofcom this week and are scheduled to meet with them again tomorrow in London.
“While Mr. Murdoch has inexplicably declared that ‘nothing is happening at Fox News,’ I look forward to appearing before Ofcom and sharing my unique insight regarding the 21 former and/or current employees we represent who have been treated unlawfully due to their race and/or gender,” attorney Doug Wigdor said in a statement today.
The NYC-based Wigdor is representing a Fox News radio reporter in one recently filed discrimination case against the company and 16 current and past FNC employees in a potential racial discrimination class action.
“I also look forward to sharing with Ofcom certain facts that make it readily apparent that 21st Century Fox should more appropriately be called 18th Century Fox.”
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