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Former Disney Exec Blows Whistle With $20M Lawsuit

Former Walt Disney senior VP for worldwide anti-piracy, Judy Denenholz, has filed a US$20 million lawsuit, alleging she was terminated after refusing to sign a fraudulent IRS audit. The suit also alleges that Disney's assistant general counsel Peter Nolan sexually harassed Denenholz since she joined the company in 1981. The suit claims that Disney's general counsel Lou Meisinger held a grudge over legal bills before he became Disney's general counsel. In 1990, Denenholz advised Disney that Meisinger's law firm was overcharging the studio for their anti-piracy work. Meisinger's law firm later reduced the charges and the studio terminated the firm from the account. However, Meisinger continued working with other studios including Fox and Sony and later became Disney's general counsel where he kept mentioning the overbilling incident in an unprofessional manner, creating tension between him and Denenholz. Later Denenholz was asked to sign off on an IRS report that greatly understated legal expenses attributable to copyright and trademark lawsuits. The complaint states that Disney improperly deducted all its expenses in one year instead of amortizing them, thus lowering the amount of taxes owed. Denenholz claims she was fired after refusing to sign the report. According to Disney litigator Patty Glaser, Denenholz was not fired, instead her contract was not renewed after it expired in January 2000.

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