After many volleys back and forth, it looks like ShopHQ has won a battle with dissident shareholders, who accused the company of having “a dysfunctional corporate culture.” But the war isn’t over. It’s just been delayed until June.
ShopHQ, corporate name ValueVision Media, has been under assault by The Clinton Group, shareholders who want to oust the home shopping channel’s current management, including CEO Keith Stewart. The stockholder group alleges that ShopHQ has been under-performing other nets such as HSN, and needs new leadersship.
The Clinton Group had demanded that a special shareholder meeting be held in February to have a vote to replace several of ShopHQ’s board members. ShopHQ had set that meeting for March 14. But on Tuesday, a cascade of events happened.
First, The Clinton Group in a filing with the Securities and Exchange Commission charged that ShopHQ unlawfully refused to hold the special meeting in a timely manner.
Here’s the blow-by-blow on that:
The bottom line was that the dissidents said they were not going to attend the special March meeting, and would instead bring up their concerns and proposals at ShopHQ’s annual shareholder meeting in June.
But in a letter to ShopHQ, The Clinton got in some pretty good punches.
We are immensely grateful for all the support we have received from our fellow shareholders and from current and former employees and vendors.
There is a clear pattern that emerges from the dozens of communications we have had with this latter group: the Company is saddled with a dysfunctional corporate culture and management structure, replete with bullying, arbitrary decision making, a lack of vision, an inability to plan, coarse language, internal dissension, high turnover and management cliques.
While the picture painted by those intimately familiar with the Company’s operation is deeply troubling, it also emboldens our view that the wounds shareholders have suffered (e.g. just two profitable quarters since Mr. Stewart took the helm 19 quarters ago) have been inflicted by poor management (and even worse strategic decision making), which can be rectified with the appropriate change in personnel.
Later on Tuesday, ShopHQ cancelled the special March meeting, and issued a press release on the move.
If you are wondering what The Clinton Group means when it refers to “bullying,” perhaps it relates to an incident that someone posted about on one of our blogs. We weren’t there. We can’t prove it. But here is what the poster wrote.
While I hesitate to name names of employees (for fear of retribution) I will give an example of this team’s unprofessional behavior.
At a company meeting one of the employees attending had just returned from having a stroke. He was still recovering and had to wear dark glasses. He was singled out by Keith Stewart in the presence of his co-workers with the words “Who do you think you are? F—— Stevie Wonder?”
This is only one example – there are others. It seems the “F” word with this executive team is in constant use. It is unfortunate that it is often used to disparage employees.
Not a pretty picture.