Netflix $39 million charge related to Kevin Spacey

One of the facts of life of being a public company is having to report the occasional charge for something that just didn’t work out. Sometimes, this can be related to job cuts, restructuring efforts or an acquisition that flopped miserably.

And then there are charges for things that don’t fit the traditional business mold. Like the $39 million in charges that Netflix took related to what the company described as “unreleased content we’ve decided not to move forward with.” Netflix made the charge public as part of its fourth-quarter results, which it released late Monday.

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But this wasn’t $39 million worth of just any kind of “unreleased content.” A source close to the matter said the charge was related to the dismissal of actor Kevin Spacey from the Netflix series “House of Cards” and the cancellation of other projects Spacey and Netflix had in the works. Among those was a planned movie starring Spacey as the late author Gore Vidal.

Netflix cut its ties with Spacey last fall after he was accused of sexual misconduct with a minor in 1986. Since then, more than 30 other men have leveled similar charges against Spacey. Netflix temporarily suspended production on “House of Cards,” then later wrote Spacey’s character, President Frank Underwood, out of the series. Netflix then said the show would come back for a final go-round this year, centered actress Robin Wright’s character, Claire Underwood.

On a conference call to discuss Netflix’s results Monday, Chief Financial Officer David Wells didn’t mention Spacey directly with regards to the $39 million charge. However, Wells said the writedown this time was “related to the societal reset around sexual harassment.”

Photo: People stand in line waiting to enter the Underwood 2016 booth near the Peace Center where a CBS News Republican presidential debate occurred on Feb. 13, 2016, in Greenville, South Carolina. Actor Kevin Spacey played the character of President Frank Underwood in the Netflix series “House of Cards” until last fall. Netflix said late Monday that it took a charge of $39 million related to the dismissal of Spacey from “House of Cards”  and the cancellation of other projects that were to involve Spacey.  (John Bazemore/AP)

 

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