The board of the Weinstein Company voted on Friday (16th February, 2018) to fire David Glasser, the companys chief operating officer. 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 Weinsteins 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 Board of The Weinstein Company has unanimously voted to terminate David Glasser for cause, the company said in a statement on Friday evening. The company did not give any further explanation. A source familiar with the boards thinking said the firing came in response to the attorney generals 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 companys 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 generals 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 generals concerns. However, Schneiderman has also raised a doubt as to whether the company will have sufficient funds to pay off victims of Weinsteins harassment.

Required: In your opinion, do you think the sacking of Glasser was appropriate? Justify.

Do you think resignation could be the best option to Glasser? Under what general circumstances should a member of a board of director resign?

Using the facts presented in the case above, do you agree that hostile takeover of firms could potentially shape corporate governance mechanisms? Justify.