The Arbitration Appeals Panel, along with Dunn’s legal team, has stated that CBS is required to pay nearly $10 million, with the payments tied to allegations related to sexist remarks made by former CBS TV station president Peter Dunn.
Last week, the Appeals Committee established that CBS had made a significant error when it attempted to alter the conditions surrounding Dunn’s termination months after his dismissal.
According to the lawsuit, CBS needs to expedite the payment before the investigation into Dunn’s conduct concludes, as termed “waking up.” His lawyer, Larry Hatcher, criticized the network, arguing that the decision was aimed at placating public outcry rather than addressing Dunn’s actual actions. “It felt overly reactionary and unjust,” he remarked.
A representative from CBS acknowledged that procedural issues led to an unfavorable arbitration ruling and claimed they were “strongly opposed” to the outcome.
“Four years ago, we removed Peter Dunn from his position due to well-documented reasons,” the spokesperson stated. “The decision was not influenced by the specific allegations against him.”
Media organizations have recently undergone numerous changes, particularly concerning high-profile exits, in an effort to satisfy regulatory officials overseeing merger approvals.
The controversy regarding Dunn began in 2021 when reports surfaced—first through the Los Angeles Times—accusing long-time executives of fostering toxic workplaces.
One former employee alleged that Dunn made comments described as “racist, sexist, homophobic, and discriminatory.”
Another claim suggested that Dunn referred to a colleague by stating they were “too gay.”
Dunn, who had been with CBS for two decades, was swiftly dismissed along with another executive implicated in the report, prompting an internal inquiry.
However, CBS terminated Dunn without concluding the investigation, which according to court documents, did not categorize his firing as “for cause.”
Instead, the dismissal letter referenced the ongoing investigation, indicating that it could lead to potential changes in the termination terms once completed.
Four months later, CBS stated they were adjusting Dunn’s termination to “for cause.” Hatcher argued that the initial dismissal was a substantial misstep due to public pressure rather than the findings of the investigation. He suggested that the appropriate approach would have been to suspend Dunn while continuing his salary until the inquiry wrapped up.
Upon Dunn’s appeal to arbitration, a panel of retired judges determined that CBS clearly violated his employment contract, which did not provide them with the option to delay a decision regarding cause.
CBS appealed this verdict, but a different panel of retired judges affirmed the ruling last week, mandating CBS to pay a total of approximately $9.78 million, with over $7 million in interest.
The appeals panel noted, “While the parties could have considered drafting such provisions, they simply did not.”
Hatcher remarked that this was the first time he had initiated arbitration in his 50-year legal career, expressing satisfaction with the results.
“This situation has always been about Peter Dunn’s efforts to restore his good name after over 20 years at CBS,” he added.
“We are pleased that the arbitrator recognized the misleading nature of the matter and look forward to having this ruling enforced by the Supreme Court.”
A CBS spokesperson reiterated their confidence in their internal investigations and the decision to terminate Dunn for cause, expressing gratitude for the numerous individuals who contributed to important cultural reforms within the network.
