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Ashley Madison’s CEO to step down after data breach

On Behalf of | Sep 4, 2015 | Mergers & Acquisitions

The fallout from the exposure of personal information stored on, the website known for facilitating clandestine liaisons is yet to be seen, as the number of divorces stemming from spouses being exposed for their cheating ways probably won’t be known for years. However, the immediate corporate effects are being felt in and outside of the company.

According to a recent USA report, former CEO Noel Biderman and Avid Life Media, Inc., the website’s parent company, have parted ways. The report indicated that the split was “mutual” but it is reasonable to believe that the split was based in part on the information breach that exposed the personal emails of nearly 37 million users. 

It is not uncommon for the head of a company to take the blame when a corporate fiasco becomes public. In these instances, a CEO is not simply thrown out on their ear. Their departure is carefully negotiated either before the change is made public. This means that counsel for the CEO and lawyers for the company will discuss the terms for the change, even if they may be spelled out in the CEO’s contract. For instance, there may be questions about the CEO’s compensation structure and what he or she may be entitled to leave with.

With the Ashley Madison situation, chances are that no specific news about such a meeting or the details surrounding it will become public. Nevertheless, corporate CEOs usually do not survive scandals with their respective companies that become headline news.