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agreement, or before issuing a press release about the hiring --

stretching the outer boundaries of his authority as CEO in a

transaction of significance to the Company. Id. at 136-38, 140.

    • d.

      Eisner made no effort to inform the full board of his discussions with Ovitz until they were essentially completed and an agreement in principle had been reached. Id. at 137.

  • 2.

    Russell

    • a.

      Failed to independently and objectively verify representations made by Ovitz’s negotiators regarding his income with his prior company. Id. at 144.

    • b.

      Failed to investigate Ovitz’s background. Id.

    • c.

      In addition, Russell was Eisner’s personal attorney and represented the Company in the negotiations with Ovitz. Id.

  • 3.

    Poitier and Lozano (as members of the Company’s compensation committee)

    • a.

      Became involved in the process of Ovitz’s hiring very late in the game. Id. at 148.

    • b.

      Failed to review and discuss the then existing draft of the full text of the Ovitz employment agreement. Id. at 154.

    • c.

      Did not have an expert (Bud Crystal) make a formal presentation at the compensation committee meeting in order for the committee and the board to rely on that expert’s analysis. Id.

    • d.

      Failed to review the compensation consultant’s report.

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