CBS CBS Corp

By Keach Hagey 

Viacom Inc. Chief Executive Philippe Dauman is challenging the validity of a move by Sumner Redstone's lawyers to remove him from the trust that will eventually control Mr. Redstone's media empire.

Mr. Dauman and Viacom board member George Abrams were informed that they have been removed from the trust by a law firm claiming to represent Mr. Redstone, according to a spokesman for Mr. Dauman.

"These steps are invalid and illegal," the spokesman said late Friday. "As court proceedings and other facts have demonstrated, Sumner Redstone now lacks the capacity to have taken these steps. Sumner Redstone would never have summarily dismissed Philippe Dauman and George Abrams, his trusted friends and advisers for decades."

The two men were also removed from the board of National Amusements Inc., the holding company that owns the controlling shares of Viacom and CBS.

Removing Mr. Dauman would be a big victory for Shari Redstone, Mr. Redstone's daughter and the vice chairman of Viacom and CBS Corp., who has clashed in the past with the executive and was the lone Viacom board member not to vote for his recent promotion to executive chairman.

A spokeswoman for Shari Redstone had no immediate comment.

Fortune earlier reported the removal of Messrs. Dauman and Abrams from the trust.

Ms. Redstone, Mr. Dauman and Mr. Abrams were three of the seven members of the trust that Mr. Redstone set up to take over his nearly 80% voting stakes in both Viacom and CBS Corp. when he dies or is incapacitated. Other members include Ms. Redstone's son and her mother's divorce attorney.

Questions about the 92-year-old Mr. Redstone's condition have only intensified since a lawsuit challenging his mental competency was tossed out by a California judge earlier this month. The suit was filed by his former companion, Manuela Herzer, who said he lacked mental capacity when he threw her out of his house and removed her as his health-care agent last October.

Mr. Redstone's profanity-laced deposition in the case was enough to convince the judge that the former executive didn't want Ms. Herzer back in charge of his health care. But the transcript revealed his extreme difficulty communicating and his inability to answer some basic biographical questions, deepening concerns within the Viacom board about his role in the company, according to people familiar with the matter. Earlier this week, the Viacom board voted to stop paying Mr. Redstone entirely.

According to Fortune, the law firm that sent the letter was Orrick, Herrington & Sutcliffe of Los Angeles. Michael Tu, the attorney who was identified as working on the letter, didn't respond to requests for comment.

Mr. Dauman has been Mr. Redstone's most trusted confidant for three decades, ever since as a young mergers and acquisitions lawyer he helped Mr. Redstone take over Viacom in 1987. But in recent months, their relationship has come under strain, as Mr. Redstone voiced opposition to Mr. Dauman's plan to sell a minority stake in Paramount Pictures, according to people familiar with the matter. Paramount was another of the great corporate trophies the two men had once won together.

Write to Keach Hagey at keach.hagey@wsj.com

(END) Dow Jones Newswires

May 21, 2016 00:39 ET (04:39 GMT)

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