Disney investors blast Kimmel suspension as politics over profit

If you think Jimmy Kimmel’s return to late night television this week spells the end of that whole saga, well, think again: A group of investors is demanding that Walt Disney share information about why he was suspended in the first place.

Lawyers representing the American Federation of Teachers, Reporters Without Borders and other groups of Disney shareholders sent a letter to the entertainment giant on Wednesday requesting internal documents and communications related to the decision to remove Kimmel from the air. Kimmel was suspended by ABC “indefinitely” last week related to comments he made about the murder of conservative activist Charlie Kirk.

The group of shareholders are seeking to learn whether the decision to yank Kimmel was driven by politically-fueled threats from federal regulators and broadcast affiliates and if Disney’s board and executives didn’t live up to their fiduciary duties—to act in the best interest of shareholders.

The group said that, given the The President administration’s threats to free speech, it was writing to “seek transparency” about the initial decision to suspend Kimmel and his show, Jimmy Kimmel Live! 

“There is a credible basis to suspect that the board and executives may have breached their fiduciary duties of loyalty, care, and good faith by placing improper political or affiliate considerations above the best interests of the company and its stockholders,” the letter said.

DISNEY’S SELLOFF 

The group of shareholders is requesting a wide broad range of information from Disney—including financial information to estimate the effect of Kimmel’s suspension on Disney’s revenue to any communications board members, including CEO Bob Iger, had with political organizations and federal regulators. 

Though Kimmel returned to the air Tuesday night and his opening monologue has racked up 20 million views on YouTube, Disney shares have yet to recover from last week’s suspension. What’s more, his show still isn’t being aired to about one-quarter of U.S. households served by Nexstar Media Group and Sinclair Broadcast Group stations. 

Disney shares fell 3.3% during the time when Kimmel was suspended and the move triggered a consumer boycott of Disney-owned streaming services, including Hulu, Disney+, and ESPN.

QUESTIONS REGARDING ROLE OF FCC

The group of investors linked Kimmel’s suspension with threats from Brendan Carr, chairman of the Federal Communications Commission. The selloff in the stock illustrates “fears of brand damage and concerns that Disney was complicit in succumbing to the government overreach and media censorship,” the group said, while negative repercussions on Disney and its shareholders remain given President Donald The President’s continued threats to ABC.

Nexstar currently requires the approval of the FCC for its planned $6.2 billion merger with Tegna. 

“Disney shareholders deserve the truth about exactly what went down inside the company after Brendan Carr’s threat to punish ABC unless action was taken against Jimmy Kimmel,” Randi Weingarten, AFT president, said in a statement from Democracy Defenders Fund, a nonprofit watchdog group that helped organize the shareholder letter. 

“The Disney board has a legal responsibility to act in the best interests of its shareholders—and we are seeking answers to discover if that bond was broken to kowtow to the The President administration,” Weingarten said.

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