Disney shareholders are suing the company's board and Chief Executive Officer Michael Eisner, saying that a $140 million severance package for Michael Ovitz, the superstar agent who briefly served as Eisner's deputy, was financially irresponsible.
Interest is running predictably high in the case, which promises juicy details and a clash of colossal egos and could be deeply influential on future boards of directors. That means the tiny courtroom in Delaware's Chancery court can barely hold the attorneys for both sides, much less other interested parties.
To remedy the problem, the court is turning to the Web.
"We decided to...have it on the Web site because so many people are interested in the trial," said Mary Ellen Greenly, assistant to Chancellor William Chandler, the judge who will be hearing the case. "There are only 55 seats in the courtroom, and 35 attorneys coming."
The decision, virtually unprecedented in American courts, could prove to be the starting point in bringing courtroom proceedings to a wider audience using Net broadcasts.
Judges have historically beento the scrutiny of cameras, much less television or live video. That's changed in recent years with the rise of Court TV and the live broadcasts of high-profile celebrity-studded events such as the O.J. Simpson trial, but many courts still bar cameras.
What's happening in Delaware "couldn't happen now in federal courts, because there is a prohibition against cameras, and specifically against broadcasting and recording," said David Sellers, a spokesman for the Administrative Office of the U.S. Courts. "It's a pretty stable policy."
The trial itself is likely to attract considerable attention, coming at a time when Disney CEO Eisner has facedof his tenure.
Shareholders are seeking $200 million from the board and Eisner in recompense for the pay package given to Ovitz, who served just 15 months under Eisner between 1995 and 1996. The case has been meandering through courts since being filed in 1997.
The Delaware Chancery court, a common venue for high-stakes corporate battles, initially dismissed the suit. But the state's Supreme Court later overturned that ruling, ordering the lower court to hear the case after all.
The core issue will be whether Disney board members and executives were adequately guarding shareholder interests by offering such a staggering contract to Ovitz. Ovitz' attorneys, in turn, will simply argue that he wanted to fulfill his contract, and that he did nothing that would void the terms of his severance agreement.
But salacious details of Ovitz' spending--ranging from $350,000 for "home catered" breakfasts to a $2 million office renovation--are likely to spice up the accounting issues.
The trial will be carried by Courtroom Connect and provided free to Delaware residents. Others will be required to pay $10 per day for access. Morning sessions will be available at 1 p.m., and afternoon sessions will be posted to the Web site at 6 p.m., a representative said.