A MA probate judge has issued a series of questions in the lawsuit brought by Viacom CEO Philippe Dauman and George S. Abrams over their removal as Trustees of the Sumner M. Redstone National Amusement Trust.
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“I don’t think it’s appropriate to use shareholder money for the suit”, Ben Strubel, a principal with Viacom shareholder Strubel Investment Management, told Reuters. Dauman now oversees MTV, VH1, Comedy Central, Nickelodeon, movie studio Paramount Pictures amongst other valuable properties. Despite the company’s well-chronicled turmoil, Viacom’s stock is actually up this year in anticipation of Dauman’s firing.
Viacom said the company suffered in the quarter from poor box-office sales of its “Teenage Mutant Ninja Turtles: Out of the Shadows” film.
NAI has already taken steps to oust Dauman from its board of directors as well as a family trust that will eventually control Redstone’s $40 billion media empire when he dies or is incapacitated.
Separately, Viacom on Friday said it would pay legal expenses of Mr. Dauman and board member George Abrams.
Viacom’s shares traded down in Friday’s premarket session but were up as much as 2.7% after the opening bell. Dauman does remain CEO for the time being, though he appears to be in a fight for that post as critics line up against him. If he is removed, he could potentially receive almost US$90 million in severance, according to compensation consultant Equilar. The changes, which must be affirmed by a DE judge, have been described by Viacom’s lead independent director as “a brazen and demonstrably invalid attempt by Ms. Redstone to gain control of Viacom”.
National Amusements has also moved to remove five Viacom directors including Dauman.
They will sit alongside Viacom COO Tom Dooley, Cristiana Falcone Sorrell, Deborah Norville, Charles Phillips Jr., chairman emeritus Sumner and non-executive vice chairman Shari Redstone.
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Shares of Viacom, Inc. “It is certainly in the interests of all of Viacom’s stockholders that the MA actions be pursued in order to preserve the independence of Viacom’s board”. “The need for strong, independent oversight of Viacom could not be more apparent”, National Amusements said. That’s essentially corporate speak for “You can’t fire me, I quit!”
