In the 14-page lawsuit, [Stanley Jaffe] says he first learned that his job was in jeopardy by reading "media reports." Subsequent efforts to discuss his status with senior Viacom executives were rebuffed, according to the suit. Jaffe says that his duties were "materially reduced" by mid-February, and that he was excluded from meetings of the company. Former Paramount Chairman Martin S. Davis finally gave him formal notice he had been fired on Feb. 28, the suit says.
At issue in the case are 466,668 shares of Paramount stock that Jaffe says he had the right to exercise at $42.125 a share under his employment agreement. The lawsuit says Jaffe was "ready, willing and able" to exercise those options, but that Paramount refused to make the stock available, thereby depriving him of the chance to cash in at as much as $107 a share by the March 1 deadline that was established for Paramount shareholders to tender to Viacom.
Sources say Jaffe and his attorney unsuccessfully tried to resolve the issue before the suit was filed. One source hinted that other Paramount employees may bring similar claims, but Viacom's stance appears to be that Jaffe's case is unique because he was seeking favored treatment.