Accusations of harassment become a weapon to control companies

Accusations of harassment become a weapon to control companies

Why was he fired? Steven Eror, founder and CEO of ProLung?

According to the board of directors of ProLung Inc., the small medical company that Eror helped to found, was a serial stalker who played and spied on the employees. He also used company funds for personal expenses, they say, adding to what the directors have called "furtive, dangerous and risky."

The version of Eror is different. The accusations against him are baseless and are the result of a "false, self-serving investigation based on unfounded allegations," he said in an email. Eror rejects his dismissal and urges investors to add eight new members to the board of directors.

The struggles for corporate control have never been pleasant. Now the accusations of inappropriate behavior – inadequate sexual behavior, racial intolerance, general intimidating attitude – become new weapons in the battles between investors, executives and directors of companies from the small ProLung even giants like CBS Corp., Athenahealth Inc. and Papa John's International Inc.

"We talked about things that 10, 15 or 20 years ago we would not have talked about in the meeting room of the board," said Davia Temin, founder of the crisis consulting company Temin & Co., which keeps a daily record of the accusations of harassment and inappropriate behavior.

"We have gone from detecting sexual harassment to beginning to act on it and to eradicate it from our organizations. Now we are turning it into a weapon in the struggles for control of companies. "

In the last 21 months, more than 670 executives and employees have been accused of harassment or other inappropriate behavior, according to the records of Temin & Co. This includes some 67 founders, at least 26 of whom have ended up abandoning their firms, including Leslie Moonves, the CEO of CBS Corp. who resigned last weekend.

Even when there are no accusations of inappropriate behavior, the struggles often reveal deep divisions regarding the direction and strategy of a company. The accusations of inappropriate conduct against Eror must be added to the outrage at what the board of directors calls the company's frustrated IPO plan of 15 people in 2017, according to a report on August 27.

Not everyone agrees that Eror's dismissal was fair. The former president of the board of directors Todd Morgan He said in a statement that the board was divided over the evidence against Eror and that some directors had refused to give him an opportunity to answer.

ProLung manufactures a device designed to contribute to the medical diagnosis of pulmonary problems. The product is not yet available in the United States, but ProLung is scheduled to meet with the Food and Drug Administration (FDA) to evaluate a study of the technology.

The ProLung board of directors wrote a letter to investors last month urging them to go ahead and saying that a return of Eror could "interrupt our progress and prejudice our filing with the FDA."

Eror, for his part, said that his main objective is "to restore order" through his election of directors.

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