Yahoo CEO Issues Apology As Board Reviews Academic Record

It's A Setback Company Doesn't Need Amid Latest Turnaround Attempt

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Yahoo board members met on Monday to review the academic record of CEO Scott Thompson, a person briefed on the plans said, as investor Third Point LLC stepped up pressure for his ouster.

Scott Thompson
Scott Thompson

Third Point last week uncovered discrepancies in Mr. Thompson's resume and demanded that the board fire him. The biography for Mr. Thompson, who joined Yahoo from eBay in January, listed a bachelor's degree in computer science from Stonehill College, a credential that wasn't offered until four years after he graduated, Third Point CEO Daniel Loeb said.

The fallout marks a setback for Mr. Thompson, who had just embarked on efforts to revive growth and help the company do a better job coping with challenges in online advertising and social media from Google and Facebook. Yahoo's board fired former CEO Carol Bartz in September amid falling sales.

Yahoo's board said last week that it would review matters related to Mr. Thompson's bio and "make an appropriate disclosure to shareholders." The company had earlier called the discrepancy an "inadvertent error" and said it "in no way alters that fact that Mr. Thompson is a highly qualified executive with a successful track record leading large consumer technology companies." Dana Lengkeek, spokeswoman for Sunnyvale, Calif.-based Yahoo, declined to comment.

Mr. Thompson, in a memo to staff yesterday, apologized for the fallout from the disclosures . He said that he takes "full responsibility" and that he's cooperating with the review.

"I want you to know how deeply I regret how this issue has affected the company and all of you," Mr. Thompson said. "We have all been working very hard to move the company forward, and this has had the opposite effect."

Yahoo's board has created a three-person committee to investigate the matter and is hiring an outside law firm to help oversee it, the Wall Street Journal reported yesterday. New York-based Third Point demanded yesterday that it be able to inspect records related to Mr. Thompson's hiring, as well as the appointment of director Patti Hart, whose credentials it also questions.

"Yahoo shareholders and employees will be best served if the board accepts responsibility quickly for this latest debacle," Third Point said in a letter. "If the directors are truly interested in 'working in a constructive manner with Third Point,' they should provide answers promptly."

Mr. Thompson has cut 2,000 jobs and overhauled management. The company's shares had their biggest rally in almost four months on April 18 after Yahoo reported first-quarter sales that topped estimates, fueling optimism that turnaround efforts may take hold. A day earlier, Yahoo had reported its first revenue gain in more than three years.


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