In court papers, lawyers for Viacom chief executive Philippe Dauman asked a judge to order an immediate medical evaluation of Redstone.
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The battle over control of Sumner Redstone’s $40 billion media empire moved to a MA courtroom on Tuesday, where a state judge said he needed time to decide whether to move up the date of a trial questioning the 93-year-old’s mental competence. The trust will control Redstone’s family investment vehicle, National Amusements Inc. which includes Viacom and CBS after he dies or is incapacitated. The executive and Abrams sued in May, saying their removal from Redstone’s trust amounted to an unlawful corporate takeover by Redstone’s daughter Shari Redstone.
In her declaration to the MA court, she says, that past year, Redstone stopped showing interest in his businesses.
Of course, Dauman and Abrams are displeased by the fact that they weren’t given an opportunity to cross-examine the chairman emeritus.
Dauman is arguing that it is crucial to proceed quickly given Sumner Redstone “is vulnerable at any time to mortal disease”.
In a move that further undermines Viacom CEO Philippe Dauman, the company’s controlling shareholder said Monday it amended Viacom’s bylaws to require unanimous board approval for any full or partial sale of movie studio Paramount Pictures.
Mr. Redstone owns a 80% voting stake in Viacom as well as CBS Corp. through National Amusements.
Redstone’s mental capacity is at the heart of litigation in two states concerning his ability to make decisions about his estate and the future of his media empire. A hearing on whether to dismiss the case is expected to be scheduled for next week. The outcome of the MA case and a comparable one in California, and who ends up managing the trust and the National Amusements board, will have varied ramifications for Viacom and CBS and might result in changes at the top of both business, potentially through mergers and acquisitions.
“They are clearly meant to impede the ability of the Viacom Board of Directors to fulfill its obligations to all stockholders, including the public non-controlling stockholders who own 90 percent of the equity of Viacom”, a Viacom spokesperson said.
Spar’s statement presents a one-sided, distorted view of Redstone’s mental state, is contradicted by evidence showing that he was suffering from a neurological disorder and a victim of impairment and dementia, who was subject to undue influence, Dauman and Abrams claimed.
Fagen said Dauman and Abrams are “perhaps Sumner Redstone’s two closest colleagues in the entire world”.
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Shari Redstone has denied that claim and insists that she has no intention of taking over her father’s company. Their statements “indicate that the principal focus of the independent directors is on preserving their own positions and those of Viacom’s management team rather than on exercising their fiduciary duty to promote the long-term interests of all Viacom stockholders”, the statement from Redstone’s camp contends.
