Tegna Board Nominee Withdraws, Citing CEO’s ‘Cultural Insensitivity’

Mr. Hoffman said he may have conflicts of interest, since he serves as a strategic adviser to numerous companies, some of which are Tegna’s direct competitors or key business partners, according to his statement, a copy of which was reviewed by The Wall Street Journal.

Mr. Hoffman, who is Black, also said in the statement that he was disturbed by an interaction in 2014 with Tegna CEO Dave Lougee. The men were seated at the same table at an industry event and spoke over lunch; afterward, Mr. Lougee mistook Mr. Hoffman for a valet, deeply offending Mr. Hoffman. At the time of the incident, Mr. Lougee was president of Gannett Co.’s broadcasting unit, which was later renamed Tegna.

“I have serious concerns whether Lougee and I could function as colleagues at Tegna or afford each other the level of professional comity and respect required of a well-functioning board,” Mr. Hoffman said in the statement that went to Tegna’s board.

In an email to Tegna employees on Monday, which a Tegna spokesman provided when asked for comment on the matter, Mr. Lougee described and took responsibility for the incident. “Mr. Hoffman was understandably offended and upset. I immediately apologized to him and felt terrible,” Mr. Lougee wrote. “I don’t condone racism of any kind, I take full responsibility for this mistake, and am truly sorry for the pain I caused Mr. Hoffman.”

Mr. Lougee said Tegna’s board and management has made diversity, equity and inclusion a corporate priority. The company said about 37% of its new hires last year were people of color and as of Dec. 31, 25% of its 6,427 employees were people of color. Tegna provided no further comment beyond Mr. Lougee’s email.

Mr. Hoffman was part of a slate of four directors nominated in January by Standard General LP. The hedge fund, which has a roughly 9% stake in Tegna, is waging a proxy battle with the broadcaster after losing a similar fight last year.

Standard General got involved in Tegna over concerns that the company, which operates 64 stations in 51 markets and has a market value of about $4.2 billion, wasn’t taking potential buyout offers seriously enough. Tegna rebuffed a potential takeover from private-equity firm Apollo Global Management Inc. in 2019.

Last year it received interest from competitor Gray Television Inc. and another round of interest from Apollo.

Tegna said it has weighed all serious offers. The fund has also voiced concerns about Mr. Lougee’s leadership.

In an interview, Mr. Hoffman said he didn’t initially raise his concerns about Mr. Lougee when Standard General recruited him as a board nominee in January.

“At the time I was busy and didn’t think much about it,” Mr. Hoffman said of the nomination. “It wasn’t until the process took its course that I realized my conflicts of interest and thought more about this matter.” Last year, Mr. Hoffman wrote an article about Tegna, arguing it is the last attractive acquisition target in broadcast media. 

Mr. Hoffman sent the statement withdrawing his nomination to the executive recruiting firm that had approached him, as well as Standard General. It ultimately went to Tegna’s board. A securities filing on March 4 noted that Mr. Hoffman had withdrawn his nomination but didn’t provide the reasons.

The statement from Mr. Hoffman included a detailed summary of the 2014 incident. When the two men were leaving the industry luncheon, Mr. Lougee extended what Mr. Hoffman initially thought was a business card, but what turned out to be Mr. Lougee’s valet ticket, the statement says.

Mr. Hoffman recalled saying, “Oh, I understand. you saw a brown man in a business suit, and you thought he was the valet? So you want me to go get your car?” according to Mr. Hoffman’s statement. The two men had other awkward incidents in the ensuing years, including one in which Mr. Lougee, “red-faced and very disturbed,” asked what he could do to live down the 2014 encounter, according to Mr. Hoffman’s statement.

Write to Lillian Rizzo at [email protected]