Battle over Redstone's media empire takes another turn

WASHINGTON – The battle over the fortune of ailing media mogul Sumner Redstone has taken another turn. Lawyers for Redstone are seeking to remove two members of the board of the trust that will eventually control Redstone’s media empire, which includes CBS Corp. and Viacom Inc.

Viacom Chief executive Philippe Dauman and George Abrams, a member of Viacom’s board, were informed that they had been removed from the trust that will control Redstone’s companies after he dies or is declared incompetent.

Michael Tu, an attorney with the law firm representing Redstone, said in a statement that Redstone had taken “decisive and lawful action which he firmly believes is in the best interest of Viacom Inc. and its stockholders.”

In his statement, Tu, a lawyer with the Los Angeles law firm Orrick, Herrington & Sutcliffe, said that Dauman and Abrams had also been removed as directors of National Amusements Inc., the holding company that owns the controlling shares of cable giant Viacom and CBS.

But Viacom released a statement Saturday attacking the actions as inconsistent with Redstone’s wishes and contended they were being driven instead by Redstone’s daughter, Shari Redstone.

“The picture is quite clear, Mr. Redstone is being manipulated and used by his daughter in an attempt to accomplish her long-held goal, which Mr. Redstone has always opposed, of gaining control of National Amusements and Viacom,” the Viacom statement said.

Viacom also said Redstone had not spoken during an in-depth strategy session of its board Tuesday evening and all day Wednesday. “Not a sound was heard from Sumner, who was connected by phone,” the statement said.

“The only contact was a written communication on Tuesday from Mr. Tu, a lawyer previously unknown until this week to anyone associated with Sumner other than Shari Redstone,” the Viacom statement said. “It is clear that Shari Redstone has isolated her father and put his residence on lockdown, which provides clear evidence of her exercise of undue influence.”

Efforts to reach Shari Redstone for comment Saturday were not successful.

Tu said that Sumner Redstone “acted after he expressed his concerns regarding Viacom’s performance to Messrs. Abrams and Dauman, both Viacom directors, and received no response from them.” The price of Viacom stock has dropped by 40 per cent over the past year.

The move to oust Dauman and Abrams followed the dismissal of a lawsuit earlier this month over the 92-year-old Redstone’s medical care.

Los Angeles Superior Court Judge David J. Cowan ruled that Redstone had clearly stated his intentions in videotaped testimony. In that deposition, Redstone said he wanted his daughter Shari to make medical decisions for him if he is incapacitated and that he no longer wanted former girlfriend Manuela Herzer in his life.

Herzer had filed a petition last year contending that Redstone lacked the mental capacity to expel her from his home and he could no longer make informed decisions.

Redstone has a serious speech impediment, relies on a feeding tube and requires 24-hour care but his doctor has not declared him incapacitated.

Herzer’s lawyer said outside of court that his client would file a new suit against Shari Redstone for at least $70 million, contending the daughter had interfered with Herzer’s expected inheritance and had set up a spy network of her father’s nurses to help her dislodge Herzer from Sumner Redstone’s life.