Greene Out as President of Grammys

C. Michael Greene, the executive who transformed the Grammy Music Awards from a minor industry ritual into a global television event, resigned Saturday night amid questions over his personal behavior and his leadership at the organization, Grammy sources said.

Greene’s resignation as president took place during an emergency board meeting at the Beverly Hilton Hotel to discuss a sexual harassment probe commissioned by the Grammy organization, the sources said.

It was unclear, however, precisely what prompted Greene’s sudden departure.

The extraordinary gathering was attended by 38 Grammy trustees who flew in from 12 chapters across the nation.

Greene, who had three years left on his contract, will exit the organization with as much as an $8-million severance buyout, Grammy sources said.

The 52-year-old Greene was unavailable for comment. Representatives for the National Assn. of Recording Arts and Sciences, the Santa Monica-based nonprofit group that stages the popular annual Grammy telecast, also could not be reached late Saturday.

During his 14-year reign as Grammy president, Greene became one of the most powerful and controversial figures in the music industry.

The Grammy Awards offer record companies worldwide exposure that can be worth millions of dollars in additional album sales. Winning a Grammy helps boost music sales, as does a performance by musicians on the telecast. Greene was instrumental in deciding which acts received the coveted TV performance slots and which judges were picked for the blue-ribbon awards panels.

Greene came under renewed scrutiny in February when Grammy trustees paid a former female Grammy executive $650,000 to settle allegations of sexual abuse against Greene.

Greene said he had never sexually harassed anyone at the academy, but said he chose not to fight the payout because he did not want to disrupt the organization.

After that case, the board hired veteran private detective Jack Palladino to investigate further. Palladino’s firm spent several months interviewing dozens of former Grammy employees and put together a lengthy report, which was delivered several weeks ago to an advisory committee run by Grammy Chairman Garth Fundis, Grammy sources said. Fundis is a Nashville record producer who is an unpaid Grammy volunteer.

Discussions between lawyers representing Greene and the academy grew tense last week after Greene learned that Fundis planned to fly in most of the 42-member board for an emergency trustee meeting on Saturday to address the report’s findings.

Greene Warning of Suit Limited Disclosures

In the days leading up to the meeting, Greene’s attorneys warned the academy that he might sue if any information from the report became public, Grammy sources said. As a result, the advisory committee decided to take the precautionary step of disclosing only selected findings to the board.

On Thursday, lawyers for Greene and the academy began to discuss his possible resignation. By late Friday night, they had reached an agreement, subject to board approval.

The Saturday meeting started at noon and ran until about 8 p.m., and included a brief synopsis of the sexual harassment probe, for which Greene was present. After the findings, Greene gave an emotional resignation speech in which he cited philosophical differences with the Grammy board and did not want to drag the organization through nasty litigation, according to Grammy sources close to the negotiations.

A lengthy discussion followed Greene’s speech, in which some board members voiced their support for the embattled executive. But the board ultimately accepted his resignation, Grammy sources said.

After Greene left the room, the board voted to approve his severance package.

Greene’s exit marks the end of an era at the Grammys--a nonprofit organization that had become inextricably linked to his own strong personality. His compensation package last year exceeded $2 million--nearly four times what the academy’s philanthropic arm dispersed to indigent artists--and his job perquisites included an annual membership in the exclusive Bel-Air Country Club and a leased Mercedes sedan.

The shake-up signals a new direction on the part of the academy’s board. In recent months, Greene’s alleged behavior sparked a boardroom revolt led by Grammy Chairman Fundis.

Greene’s resignation follows a year of controversy during which he was accused of assaulting and sexually harassing a female executive who ran the Grammy’s human resources department.

Last July attorneys for the Grammy executive, Jill Marie Geimer, threatened to sue the academy, and raised allegations of physical, sexual and psychological abuse by Greene over a one-year period.

In September, attorneys for the academy said Geimer was lying and that Greene “‘never touched her.” Several months later, Grammy trustees paid Geimer to resolve the case following a settlement conference at which her lawyers presented accusations involving at least two other female executives whom Greene allegedly harassed and forced out of the organization during the mid-1990s, according to Grammy sources.

Greene broke into the music industry in the 1970s as a saxophonist and worked at recording studios and cable TV stations before joining the Grammy organization in 1985 as an unpaid Atlanta chapter president. In 1988, he moved to Los Angeles and took over as Grammy president and chief executive.

14-Year Tenure Saw Tremendous Growth

During his tenure, Greene presided over a period of tremendous growth at the academy. When he took over, the organization had 14 employees, 3,500 members, and $4.9 million in assets. The Grammy organization currently has about 120 staffers, 17,000 members, and more than $50 million in assets.

On Greene’s watch, the TV rights to the Grammy Awards show rose dramatically in value. Several months ago, he negotiated another five-year extension of the broadcast rights with CBS for more than $20 million annually.

The board rewarded Greene handsomely for his efforts. Last year, he was the highest-paid nonprofit executive in the U.S.

Nevertheless, over the years, Greene faced questions about his management style. A series of articles in The Times disclosed internal complaints about the work environment at the Grammy organization and revealed that the group consistently overstated the scale of its philanthropic activities. MusiCares, one of the group’s philanthropic arms, has typically spent three times as much on administration and fund-raising as it disburses to the needy, according to tax records.

Employees said turnover at the academy’s two charitable arms was high and suffered from an exodus of top executives forced out by Greene.

Greene’s last year at the Grammys was plagued by other problems.

In August, he weathered protests by political leaders in Miami about the Latin Grammy Awards there. Then, at the last minute, Greene decided to move the show back to Los Angeles--at great expense to the academy. The nonprofit group lost even more money when the show’s planned Sept. 11 telecast was canceled following terrorist attacks on New York and the Pentagon.

In December, Greene was sued by music industry legend Dick Clark, who claimed the Grammy chief threatened artists not to perform on Clark’s American Music Awards. And in February, Greene was booed when he was on international television while giving an anti-pirating speech during the 2002 Grammy Awards telecast, which had its lowest TV viewer ratings in a decade.

The Grammy organization will start the search for a new president immediately. In the meantime, Fundis will take over the reins at the nonprofit academy.