Viacom’s embattled chief executive sued Monday to be restored as a director and trustee to entities that control Viacom Inc. and CBS Corp. after a weekend move by media mogul Sumner Redstone stripped him of the positions.
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Meanwhile, though, investors are already benefiting from the mere thought that significant changes could be forthcoming, as the stock is up 15 percent since last Friday, when Redstone booted Dauman and Abrams from the trust and the National Amusements board. “I have picked those who are loyal to me and removed those who are not”, Redstone said in a statement Tuesday.
Viacom directors are preparing for the possibility that media mogul Sumner Redstone, on his 93rd birthday, might move to replace the Viacom board with directors he and his daughter Shari Redstone would choose.
Last week it was revealed that Viacom’s CEO Philippe Dauman had been removed as a trustee of Sumner’s carers, and from the Board of National Amusements Inc (which owns 80 percent of Viacom’s powerful voting shares).
The battle is important: Redstone’s seven-member trust will control his media empire when he’s either deemed incompetent or passes.
A statement sent on behalf of Shari Redstone said: “It is absurd for anyone to accuse Shari of manipulating her father”.
Earlier in May, a judge dismissed a lawsuit by a former girlfriend who had argued Redstone was not mentally competent to remove her from his advance healthcare directive.
The complaint named Shari Redstone, her son Tyler Korff, as defendants and trust members David Andelman, Norman Jacobs and Leonard Lewin as nominal defendants.
Dauman has challenged his removal as a director with a lawsuit filed in MA.
In his email, Dauman not only sought to reassure employees, be he also put forth an update on Viacom’s various business.
“Sumner makes his own decisions. and has his own team of independent advisers to counsel him”, she said.
But Redstone’s lawyers said the colorful tycoon made the decisions himself, and blasted the two for suggesting he was not mentally competent to handle his own affairs.
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In the suit, Mr. Dauman accused Ms. Redstone of “attempting to illegally hijack her father’s well-established estate plan” and trying to mount an “unlawful corporate takeover” that could have “far-reaching consequences for thousands of shareholders and employees of Viacom”.
