Redstone Cases Going to Court in October

Rulings could affect control of Viacom

Courts in three states will be weighing in on the battle for control of Viacom and the rest of Sumner Redstone’s media empire in October.

On Friday, Delaware Chancery Court denied a motion by Redstone and his daughter, Shari Redstone, to have an attempt to remove five Viacom directors, including CEO Philippe Dauman, declared valid.

“What’s at stake here, of course, is nothing less than the governance of a multibillion-dollar company, and the parties’ views of Mr. Redstone’s wises in that regard could not be more different,” said Chancellor Andre Bouchard.

In Massachusetts last week, a judge similarly denied a motion to dismiss a suit by Dauman over his dismissal from the board of Redstone’s holding company, National Amusements, and as a trustee of the trust that will control Redstone’s assets when he is dead or incompetent to make decisions.

The 93-year-old mogul is in failing health, which makes it difficult for him to communicate. Dauman in Massachusetts and Viacom director Fred Salerno in Delaware, claim that Redstone’s recent actions are invalid because Redstone is incompetent and under the undue influence of Shari Redstone.

Redstone has also brought an action to validate his decisions in California, where last year he won a ruling to have his former live-in companion removed as his health-care agent over similar charges that Redstone is incompetent and being influenced by Shari Redstone.

In the Massachusetts court, the judge ruled against Dauman’s request to have his doctors conduct a mental examination of Sumner Redstone immediately.

The judge in Delaware said he wanted the cases to be coordinated in discovery in order to minimize discomfort to Redstone. At the same time, he seemed to think determining Redstone’s mental competence was a key issue and that it would be hard for Redstone’s lawyers to prevent one through procedural maneuvers.