In an SEC filing 11/18, NY attorney Joe Siegelbaum resigned from the board of Emmis. Why? Emmis sued Siegelbaum, alleging he inappropriately leaked confidential company information. The lawsuit, filed in Marion County, IN (Indianapolis) Superior Court, accuses Siegelbaum of leaking information that prompted a stock deal to fall through.
The suit alleges Alden Capital Group withdrew its offer to sell its preferred stock to Emmis after Alden was made aware of a special Emmis board meeting by Siegelbaum. The deal also would have settled litigation between Alden and Emmis over failed efforts to take the company private, the new suit says.
Emmis, in a statement, said “the resignation was not due to any disagreement with Emmis on any matter relating to Emmis’ operations, policies or practices.”
Said Jeff Smulyan, Emmis Chairman and CEO: “We certainly respect the rights of our preferred shareholders to elect directors to Emmis’ board, but we can not stand by when one of those directors leaks confidential information.”
Siegelbaum’s departure comes as Emmis begins a buyback of some of its 6.25% preferred notes. Siegelbaum was originally nominated as a director by preferred stock owner Zazove Associates. His term wasn’t due to expire until 2012.