Judge Grants Request by Viacom Chairman, Board Member for Hearing Over Ouster From Trust
May 27 2016 - 6:20PM
Dow Jones News
A Massachusetts judge has granted the request from Viacom Inc.
Chairman Philippe Dauman and board member George Abrams for a
speedy hearing in their legal battle with Shari Redstone, the
daughter of Viacom's controlling shareholder, Sumner Redstone.
The two filed a lawsuit on Monday to invalidate their removal
from a trust designed to oversee the media mogul's holdings should
he die or be declared incapacitated. They also want to be
reinstated to the board of Mr. Redstone's holding company, National
Amusements Inc., which oversees his controlling stakes in Viacom
and CBS Corp.
A hearing has been scheduled for June 7 by Judge George Phelan
of the Norfolk Country Probate and Family Court in suburban Boston.
National Amusements is based in Massachusetts.
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."
Ms. Redstone has denied she is behind the dismissals of Mr.
Dauman, who is also Viacom's chief executive, and Mr. Abrams from
the trust and has called the suit meritless.
Viacom board members have been rebuffed in recent efforts to
meet with Mr. Redstone, who celebrated his 93rd birthday on Friday
with family including Ms. Redstone.
Frederic Salerno, Viacom's lead independent director, was asked
earlier this week by Michael Tu, a lawyer retained by Mr. Redstone,
to submit a written agenda for a meeting with the mogul, who is in
poor health. Mr. Salerno responded with such an agenda. A spokesman
for Mr. Redstone said a response would be forthcoming in the near
future.
Investors are expecting Mr. Redstone to make changes to Viacom's
board.
"It's a question of when, not if," said Mario Gabelli, who holds
the second-largest voting stake in Viacom behind Mr. Redstone. Mr.
Gabelli defended Mr. Dauman's recent moves, including signing a new
distribution agreement for Viacom's cable networks with the
satellite broadcaster Dish Network Corp. However, the legal
bickering is wearing on him. He said he didn't like the fact that
Mr. Dauman and Mr. Abram's suit named Mr. Redstone's grandchildren
as nominal defendants.
Viacom's board is gearing up for a court fight in Delaware,
where the company is incorporated, should National Amusements try
to dismiss Viacom directors or push for the firing of Mr. Dauman as
CEO, people familiar with the matter said.
A spokesman for Mr. Redstone said Friday that "Sumner Redstone
will make every decision with the same deliberation and
consideration with which he removed Philippe Dauman and George
Abrams as trustees, based on the best interests of
shareholders."
Meanwhile, activist investor Eric Jackson , of SpringOwl Asset
Management, has renewed his push for Mr. Dauman and Viacom's board
to be replaced. Mr. Jackson said on Friday that Viacom should be
merged with CBS, with CBS CEO Leslie Moonves put in charge.
A CBS representative had no comment. In the past, Mr. Moonves
has played down the idea of combining CBS and Viacom again after
the two were split a decade ago.
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
May 27, 2016 18:05 ET (22:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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