Yahoo CEO Scott Thompson steps down; informs board he has Thyroid Cancer

In the last two weeks, Yahoo has been at the center of an ongoing controversy following reports that CEO Scott Thompson lied about having received a degree in Computer Science. And now, Thompson is out as CEO.

In the last two weeks, Yahoo has been at the center of an ongoing controversy following reports that CEO Scott Thompson lied about having received a degree in Computer Science. Thompson, who had previously held senior positions at both eBay and PayPal, purportedly received degrees in both CS and Accounting from Stonehill College in 1979.

But a rudimentary Google search from Yahoo activist investor Dan Loeb revealed that Stonehill College didn't even offer a CS degree until 1983. And so the drama began.

Following that revelation, Loeb wrote a letter to Yahoo's board of directors angling for Thompson's removal. It read in part:

If Mr. Thompson embellished his academic credentials we think that it 1) undermines his credibility as a technology expert and 2) reflects poorly on the character of the CEO who has been tasked with leading Yahoo! at this critical juncture. Now more than ever Yahoo! investors need a trustworthy CEO.

For a while, Thompson appeared to hold is ground, but in the face of mounting pressure from Loeb - who wanted Thompson and other Yahoo board members fired - All Things D was the first to report that Thompson is officially out as Yahoo CEO.

The company will apparently say he is leaving for “personal reasons.”

But the evolving crisis — which is just over a week old — centered on his botched resume and how he handled the thorny issue is clearly the key reason for the abrupt leaving.

Thompson’s likely replacement on an interim basis will be Yahoo’s global media head Ross Levinsohn, who most recently also ran its Americas unit, including its advertising sales.

What's more, as part of Yahoo's settlement with Loeb, a number of Yahoo board members will step down, only to be replaced with 3 board members proposed by Loeb.

For what it's worth, Thompson blamed the Resume error on a headhunting firm which introduced "the mistake when he was being hired for a job at eBay in the mid-2000 timeframe."

And because the drama seemingly has no end, the headhunting firm in question - Heidrick and Struggles - responded that Thompson's allegations were "verifiably note true" to the extent that they had in their possession a Resume submitted to them by Thompson which indicates that he graduated with a CS degree.

And just when you thought the saga was over, the Wal St. Journal reported yesterday evening that Scott Thompson had recently been diagnosed with Thyroid cancer.

The cancer disclosure by the 54-year-old Mr. Thompson was made late last week, as evidence emerged that appeared to contradict the CEO's assertions that he wasn't responsible for an error in his academic record, one of these people said. The decision to step down from Yahoo was in part influenced by Mr. Thompson's cancer diagnosis, said this person.

The diagnosis had occurred in recent days, added this person, while the board was investigating why the executive's academic record had erroneously included a computer science degree. The error in Mr. Thompson's resume appeared in a Yahoo regulatory filing and on Yahoo's and other corporate websites.

The Journal lastly notes that Thompson's agreement to step down, which includes a severance package, was completed this past Saturday.

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