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ABS-CBN Corp. reiterated in a new statement that the company is not a party in the ongoing feud among its owners in the Lopez family, but says that one of its directors “proposed shutting down” the media giant. The director in question is suspected to be Lopez Inc. President Federico “Piki” Lopez, whose refusal to authorize a P2 billion capital infusion into ABS-CBN allegedly triggered an ouster within the holding firm in February.
The statement, issued by ABS-CBN on Wednesday, April 15, also addressed “PR attacks” purporting that “68 individuals ‘received preferred treatment’ in the payout of their retirement benefits, designed to sow intrigue among employees.” The media company refuted these allegations, saying, “The majority of these individuals are retirees who have received only partial or no retirement benefits, despite already retiring. They have agreed to voluntarily wait until ABS-CBN’s financial position improves before receiving full payment.”
ABS-CBN added, “Repeated allegations that a P2 billion capital infusion would be used to pay out retirement benefits are also false. This has been refuted by all the board of directors members except one.”
The media company’s board includes Chairman Martin “Mark” Lopez, ABS-CBN President and CEO Carlo Katigbak, Rafael “Raffy” Lopez, Emmanuel de Dios, independent directors Randy David and Honorio Poblador IV, and Piki.
This comes on the heels of a power struggle among the Lopez cousins, which has exploded into an ongoing legal battle as Piki takes his ouster to court.
A History of Shutdowns
ABS-CBN isn’t a stranger to shutdowns and controversy. In September 1972, after former President Ferdinand Marcos Sr. declared martial law, the government seized the network and its affiliate stations, putting ABS-CBN President Eugenio “Geny” Lopez Jr. in jail for five years without trial. After escaping imprisonment with his cellmate, Sergio Osmeña III, in October 1977, Geny self-exiled to the U.S. The network was rebuilt when Geny returned to the Philippines in March 1986, after the People Power Revolution.
ABS-CBN faced its second shutdown in May 2020 when its franchise expired, amid the COVID-19 pandemic and under the administration of former President Rodrigo Duterte. The president had accused ABS-CBN of bias. After the network went off-air on May 5, 2020, ABS-CBN made efforts to renew its franchise, but on July 10, the House of Representatives voted 70–11 to reject its franchise application. The move was met with criticism from Filipino audiences and media workers, with human rights group Amnesty International Philippines calling it “another nail in the coffin of press freedom.” The company has coped with the shutdown by pivoting to digital platforms and streaming services, activities that don’t require a legislative franchise.
The company may still not be in a prime position to fully recover if another shutdown is indeed on the horizon. Despite this, ABS-CBN remains optimistic. “We acknowledge that, following the loss of our franchise in 2020, we have experienced challenging financial years but have shown steady, consistent improvement,” it said in its statement. “Our board of directors and the rest of the Lopez family have commended the company’s progress and emphasized its existence as important to the country.”
A Timeline of the Lopez Family Feud
February: On February 27, former ABS-CBN CEO and Chairman Eugenio “Gabby” Lopez III initiated Piki’s removal from his position as president of Lopez Inc. Gabby, his brother Raffy, Mark, his brother Miguel Ernesto “Mike” Lopez, and their cousin Maria Eugenia “Ginny” Brown all voted in favor of the ouster. Piki and his brother Benjamin Lopez voted against it.
The majority faction cites a “loss of trust and confidence” as the ouster’s cause. Their legal counsel, Ronald Ventura, later on said that the company’s bylaws “allow for the removal of any corporate officer even without cause by a majority vote.”
March: Piki filed a complaint with the Mandaluyong Regional Trial Court (RTC), asserting that his removal was invalid because it was not included in the board meeting’s agenda, thereby allegedly violating corporate rules requiring that all matters to be taken up be disclosed. According to the majority faction, Piki believed that “his removal was retaliation for refusing to authorize a P2 billion capital infusion into ABS-CBN Corp,” which has struggled financially since its shutdown in 2020.
Business Mirror reported that Piki and Benjamin had voted against using Lopez Inc.’s reserve funds on ABS-CBN due to the media company’s “unresolved audit findings.” The report also said the proposed P2 billion infusion was to be used for payouts to executives.
On March 11, the Mandaluyong RTC issued a temporary restraining order on his removal, barring Raffy, who was proposed to replace Piki, from taking on the position of president until April 1.
On March 28, ABS-CBN released its first statement on the matter, saying, “We wish to state that ABS-CBN is not a party to this case.” The statement, signed by all board members except Piki, also called the claims of “unresolved audit findings” and payouts to executives “baseless.”
April 1: First Gen Corp., which Piki chairs, said in a stock exchange filing that he “still sits as president of Lopez Inc., and First Gen Corp. continues to operate business as usual, with no disruption.”
April 15: ABS-CBN released a second statement saying a director threatened to shut down the media company. It said, “Records show that one of our directors proposed shutting down ABS-CBN without so much as discussing how it would meet its obligations to its people. Records also show that the majority of the directors strongly argued for continued financial support for ABS-CBN rather than liquidation to address the welfare of the company’s employees and retirees, as well as its other stakeholders.”
This is a developing story.
