Letterman Banned Guest: Why Harmony Korine Unwelcome on 'Late Show' (VIDEO)

David Letterman has explained to guest James Franco why director Harmony Korine was banned from "The Late Show" this week.

Franco appeared on the latenight talk show on Monday night promoting his new movie, "Spring Breakers," which was directed by Korine.

After fielding questions about Korine from Franco, Letterman finally revealed the truth as to why the director is not welcome on "The Late Show."

Letterman, 65, went on to explain an incident where he has caught Korine rifling through the purse of actress Meryl Streep 10 years earlier.

"I went upstairs to greet Meryl Streep [in the green room,] she was not in there," recounted the famed talk show host. "I looked around and I found your friend Harmony going through her purse."

Upon the discovery, Letterman said he demanded Korine put the items back into the purse and leave.

Defending his director, Franco explained the Korine "was a little out of it" back then.

"But he's a good guy now, you should bring him back on," said the actor. "I vouch for him. He's a very sane guy now."

The topic was closed after Letterman said he could consider allowing the director back on his television show.

Meanwhile, rumors of Letterman's retirement have surfaced, and likewise for his rival- Jay Leno. Both late night talk show hosts may be retiring shortly as their contracts with CBS and NBC, respectively, expire in 2014, according to The Hollywood Reporter.

Furthermore, NBC intends to change its evening lineup in 2013-14, begging rumors that Leno is leaving his long-running late show and will be replaced by Jimmy Fallon, reported THR.

Fallon and his "Late Night" show is expected to assume the coveted 11:35 p.m. time slot.

Leno has met stiff competition this year, and NBC is worried that rival late-night talk show host Jimmy Kimmel will steal young viewers from the network, according to The Atlantic Wire. Consequently, the network is reportedly contemplating replacing Leno with Fallon in order to stay competitive with Kimmel.