Yahoo's CEO steps down amid 'Resumegate'; Board reshuffles

Yahoo's CEO steps down amid 'Resumegate'; Board reshuffles

Summary: After a turbulent fortnight for the once darling of the Web, its chief executive is set to step down after allegations over resumé fixing proved too damaging for the company.

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Yahoo's chief executive Scott Thompson has stepped down and "left the company", the board of directors said in a statement, in what may have drawn a line under the college education controversy.

The news was first reported by AllThingsD, and confirmed by the company a short while later.

Whether Thompson left on his own accord or was pushed remains unclear.

Update (12:50 PDT): A company statement has confirmed Ross Levinsohn, Yahoo's global media chief, is the new interim chief executive.

Newly-added director Fred Amoroso is now chairman of the board, replacing Roy Bostock, who upon Thompson's appointment said he was "precisely the formula we need at Yahoo!".

Third Point nominees --- Harry Wilson, Michael Wolf, and founder Dan Loeb --- will join the board on May 16 as a result of the settlement agreement.

The four Yahoo directors --- Patti Hart, V. J. Joshi, Arthur Kern, and Gary Wilson --- who were set to leave the board at the company's annual meeting later this year, will resign immediately.

The board announced the move following a meeting this morning.

A Yahoo spokesperson remained unavailable for comment at the time of initial publication and updates.

The former PayPal president was hired in January to fill the void left from the sudden departure of Carol Bartz, who was famously fired by phone. At least on the bright side Thompson wasn't extended the same courtesy.

Only a few months in to his new appointment, he promised a "smaller, nimbler, more profitable" company, while at the same time serving pink slips to 2,000 employees. Thompson justified the move by claiming the company would save around $375 million per year.

Yahoo's first quarter under his leadership scraped a low bar, generating $1.077 billion in revenue minus traffic acquisition costs, managing only a 1 percent increase on the first quarter of 2011.

During the earnings call, he said the company would scrap 50 'non-core' products from Yahoo's portfolio, leaving only Yahoo News, Finance, Sports, Entertainment --- and crucially, Yahoo Mail --- in the clear.

But friction emerged between Loeb and Thompson soon after his hiring.

Dan Loeb, founder of Third Point, which has a 5.8 percent stake in Yahoo, wanted more seats on Yahoo's board. Yahoo refused, and Loeb fired back with allegations that Thompson had not been awarded a computer science degree at Stonehill College as was claimed on his Yahoo biography. The erroneous biography was made only more suspicious after it was ported from eBay pages while he was at the company.

Despite the matter only being a minor detail to his record, he had ample opportunity to correct the mistakes --- even when interviewed in person --- but failed to do so. Yahoo pulled the biography from its website within hours of Loeb's allegations, but it didn't escape SEC filings, in which the biography was ported to the filing without a moment's thought.

Yahoo effectively misled the U.S. government in an official report.

The company will now start the process of finding yet another chief executive to fill the void left behind by Thompson.

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Topics: Legal, CXO, Collaboration, Enterprise Software, Social Enterprise

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19 comments
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  • Smart decision but too late.

    It appears Yahoo is not smart enough to get out of the reactive mode. I do not believe it is legal to provide false info on a 10K either. They are doomed.
    droidfromsd
  • Liar in Chief

    [ul][i]Despite the matter only being a minor detail to his record...[/i][/ul]I don't agree that it was a minor detail. He fabricated a credential. and used it at least twice to get himself hired. That's not minor, that's the act of someone who is fundamentally dishonest. Why would anyone want such a person running their company?
    Robert Hahn
    • in Silicon Valley, college degree is not that important

      with Steve Jobs, Bill Gates and others being famous college dropout billionaires, and many others being only millionaires -- ideas and luck trump sheepskin. However, LYING about a college degree shows you don't have the self-confidence that is needed in that environment. Steve Jobs lied all the time (antenna-gate and other incidents), but he never lied about having a college degree. :)

      So, being
      ChazzMatt
      • What a disgusting slur

        Lying about qualifications says much more than a lack of self-confidence.

        What are these Steve Jobs lies?
        Richard Flude
      • The one thing you forget

        Is that both Steve Jobs and Bill Gates [i]started[/i] their respective companies. And what [i]lies[/i] did Jobs tell during "Antennagate"?
        NonFanboy
      • I Agree, what matters is the money you can get.

        You can lie, steal and manipulate everything you want but in business if you get the money, you're golden.

        Bill gate's first products were made mostly with with stolen resources and his unlicensed copyrighted IP from Darmouth university, (The BASIC interpreter was the reason he was told not to come back to harvard, and to free it to public domain the work he was selling), and also lied on the anti-trust case in front of the jury and he lied again in front of the jury on 2 different cases, the creator of DR-DOS Demostrated that QDOS was a literal copy of DR-DOS.
        And Steve Jobs not only copied Xerox's GUI and LightHouse's Keynote but he was known more for crediting himself from other people's works.

        The poor guy was only kicked out because a superior didn't liked him, this was more a struggle of power.
        jaime.gonzales.777
    • The disingenuity prism (the new ingenuity)

      @Robert Hahn
      [i]That's not minor, that's the act of someone who is fundamentally dishonest. Why would anyone want such a person running their company? [/i]

      If that was the [i]worst[/i] thing most of this country's top execs were guilty of, this nation in all likeliness wouldn't be in half the economic mess it finds itself in presently. Fundamentally speaking. ;)

      It's not a matter of dishonesty or fibbing per se that counts in business anymore, it's a matter of being able to [i]get away with it.[/i] The ability to pull off that which you fabricate (or distort, or conceal) has become a defining, triumphant metric. It's often all that differentiates the winners from the losers in contemporaneous penthouse suites.

      [i]Imagine events, that occur everyday
      Like a shooting or raping, or a simple act of deceit
      Imagine a fence, around you as high as prevention
      Casting shadows, you can't see at your feet[/i]

      ~Pete Towshend, Imagine A Man (The Who By Numbers)
      klumper
      • A society of crooks can't work

        But see, that's precisely why it is so important to treat these incidents seriously. When we treat little lies as "minor details" to be ignored, an army of envelope-pushers goes to work, constantly expanding the level of dishonesty that will be tolerated. Next thing you know, we get Enron and Derivatives From Nowhere.
        Robert Hahn
  • One must know one's limits

    [i]Yahoo effectively lied in a government report.[/i]

    Only the government reserves the right to lie in their reports.

    WMD, and beyond...
    klumper
    • Govt lies all the time!

      It's what they do best!
      otaddy
  • I.T. is rampid with resume lying

    There are so many people lying on resumes in I.T. This is a major problem somebody needs to address. Especially with the recession. I've seen it over and over at management levels.
    FireThorn
  • College Degree

    What's a college degree?
    Ashtonian
  • People should be held responsible for what they say and do

    however, as a rebuttal, was this really such a serious issue? The author says this was a "minor detail" on his record. Could he have inadvertently overlooked this "minor detail"? Does he have any other known dishonesty records in his past? I am not defending the guy, I am just wondering if we aren't being too judgmental too soon.
    afedwin@...
  • really held responsible. really

    You know what i may have spin some yarn's in my life time .But never did i lie,exaggerate ,or embelish on my application .Thouse who do are ass's and should be shot .NO not really.But why would you have too lie to get a job and not rely schooling , and experance .
    sarai1313@...
  • college education controversy

    Seriously, this is just the tip of the iceberg scenario. During boom time and fair weather - who care's if a little dust is swept under the carpet - a little loss is no great problem as long as the company is well known and making gains elsewhere.

    But come bad weather and the binoculars come out and significant people are under the microscope, particularly if the company has a significant loss. All over the world people have faked degrees. In Australia there is a joke "how do you become a doctor? Put Dr infront of your name". Or "I have a phd - personal help degree".

    Also international employment agencies have a tricky job in filling international job vacancies for countries outside an applicants place of citizenship. I wonder if money talks there! Funny Mr Thompson came from paypal!?
    wokeap
  • Embellishing resume?

    This is a ridiculous reason to make a guy step down. How many people lie on their resumes (and birth certificates for political reasons)? Did the guy do a good job? Bill and Steve never went to college. America is going through a horrible phase where there is no more privacy. Also, there are no more ways for a little guy to grow. How many of our politicians have internet-obtained diplomas? How many have a bachelor's degree in anything that can really help America? C'mon, people. This is not Big Brother or Apprentice. It's real life.
    brike2001@...
  • Lying in a Resume

    Hi all,

    We must know that we are not leaving in Heaven were everyone is pure, Davil was cast down here on earth because he was deceiving the majority in heaven and God noticed this after million, billion or trillion years maybe, and to get rid of this was to remove completely all his fellowers to cleanup, so he is the father of Lies, he is the prince of this World if you dont lie you wont survive unless Christ is in your side, so he make sure this world is corrupt mmm I think now you understand the foundation.
    nkosiv
  • brike2001 & nkosiv

    Oh dear. These days real life relies on honesty, education, and reputation. It relies on the here and now and the hard facts of life as well as good will. Religion be it devil or or evil or christ or god or allah or jehova or budism or mormon or jehovas witnesses or catholic or prodestant or anglican or human disposition because of choice is not an argument in business and ought not be. Some cultures believe that christians make better businessmen/women because of their beliefs rather than non christians. But I would argue that regardles of religious belief we all have the capability of honesty and integrity and also lack honesty and integrity regardless of faith or not. Sorry but these lines are way too blurred. Hence the problematic topic in regards to this story and the consequences in a struggling world of economics and values under stress in all conceivable circumstances. Believing in a world of evil - good and condemnation for percieved transgressions is not a helpful construct in any way.

    If self interested factions are going to end this world, then do it. Because, I personally want to get on with living with those who enjoy living and want to live better and to have visions of the world living on into the future in an accommodating manner for all. No one entity has a right over another to survive or die unless the universe can no longer support that life. Sensible organisation is a must and there are victors, survivors and losers. It is up to each and every one of us to know who we are and to build on our skills for the good of all even if we are losers at some point. It's not the end.
    wokeap
    • Lying

      MmmmmH well said thats true dear
      nkosiv