Keith Olbermann: Current Won't Pay $50 Million Deal, Cites Breach of Contract, Sabotage, Disparagement

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Keith Olbermann was informed Thursday morning that Current was terminating its five-year, $50 million contract with its star anchor.

The network sent an e-mail to Olbermann’s agent, Nick Khan at ICM, on Thursday morning stating that Olbermann was being let go for “material, serial breach of contract” and informed him that Eliot Spitzer would take Countdown’s 8 p.m. time slot effective immediately. (Spitzer will keep Olbermann’s staff and film his show, Viewpoint, out of the same Manhattan studio.)

According to knowledgeable sources, the issues were Olbermann’s repeated unauthorized absences as well as “sabotaging the network” and “attacking Current and its executives.”

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Current has asserted that Olbermann missed 19 out of 41 working days in January and February. Then on Monday, Feb. 27, Olbermann asked for a vacation day on the following Monday, March 5, one day before the Super Tuesday GOP primaries. Olbermann was told that he could not have the day off, and if he took it, he would be in breach of contract. He took the day off. But he was on the air the following day for Current’s Super Tuesday coverage.

With a split between Olbermann and Current inevitable, Current began talking to Spitzer -- who has been a guest on Countdown -- late last year, according to sources. But many industry observers assumed it would be Olbermann who extricated himself from Current. In January, Olbermann’s lawyer, Patricia Glaser, was exploring whether Current violated Olbermann’s contract by pre-empting Countdown for Politically Direct coverage of the Iowa caucuses with network personalities Cenk Uygur, Jennifer Granholm and co-founder Al Gore.

But Current has retained the muscular legal and crisis public relations firm Fabiani & Lehane to navigate what could be a very expensive and ugly legal battle. Veterans of the Clinton administration, Mark Fabiani and Chris Lehane advised the Clintons during the Whitewater and Monica Lewinsky imbroglios.

A source close to Current said the network became aware that Olbermann may have been exploring opportunities outside of Current, but that this was not necessarily an overriding factor in his termination. Olbermann had lunch with Showtime entertainment president David Nevins, though Nevins told THR, “It didn’t really go anywhere.”

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Soon after his show bowed in June, Olbermann became frustrated with a string of technical glitches, including a blown fuse in the New York studio on Dec. 5 that caused the lights to go out while he was live on the air. The next evening he returned with a candle and continued to do his show with just a black background, which sources say was viewed as a finger in the eye of Current management.

In fact, tension between Olbermann and Current executives began with the ouster of former CEO Mark Rosenthal in July. Rosenthal was instrumental in recruiting Olbermann to Current and had a knack for the ego sublimation necessary for effective talent management. But multiple sources close to the network and Olbermann describe his relationship with network co-founder Joel Hyatt and Current TV president David Bohrman as either non-existent or extremely strained. And by November, the situation had become so frayed that Gore attempted to smooth things over and implore Olbermann to participate in the network’s political coverage.

But in January, a leaked memo from Bohrman stating that Olbermann rebuffed repeated requests to anchor and executive produce the network’s primary coverage spurred a battle of words. And Olbermann responded that he was “not given a legitimate opportunity to host under acceptable conditions. They know it, and we know it. Telling half the story is wrong.”

A statement from Gore and Hyatt announcing Olbermann's termination underscored the personal animosity between the two parties: "Current was … founded on the values of respect, openness, collegiality and loyalty to our viewers. Unfortunately, these values are no longer reflected in our relationship with Keith Olbermann, and we have ended it.”

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Olbermann responded with his own statement laying the blame for the dispute on Current executives.

“For more than a year I have been imploring Al Gore and Joel Hyatt to resolve our issues internally, while I've been not publicizing my complaints, and keeping the show alive for the sake of its loyal viewers and even more loyal staff,” said Olbermann. “Nevertheless, Mr. Gore and Mr. Hyatt, instead of abiding by their promises and obligations and investing in a quality news program, finally thought it was more economical to try to get out of my contract.”

He also all but assured legal action, saying, “It goes almost without saying that the claims against me implied in Current's statement are untrue and will be proved so in the legal actions I will be filing against them presently.”

And in a parting shot, Olbermann raised a 1990 discrimination suit against Hyatt’s Hyatt Legal Services Inc. (which Hyatt has since sold).

“To understand Mr. Hyatt’s ‘values of respect, openness, collegiality and loyalty,’ I encourage you to read of a previous occasion Mr. Hyatt found himself in court for having unjustly fired an employee. That employee’s name was Clarence B. Cain.”

A federal judge in that case ruled that Cain was illegally removed as head of Hyatt Legal Services’ Philadelphia office after his superiors learned that Cain had AIDS.

Email: Marisa.Guthrie@thr.com

Twitter: @MarisaGuthrie

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