Philippe Dauman Tells Court There’s Ample Evidence To Order Redstone Exam
Sumner Redstone’s efforts to kick Viacom CEO Philippe Dauman and director George Abrams out of his inner circle were “unnatural” and suggest that his daughter, Shari, exercised “undue influence” over him, Dauman and Abrams say this morning in court filings.
What’s more, they say that if they’re right, then Shari Redstone and her allies on the seven-member family trust “may well be adjudicated unqualified to continue serving as trustees” to run his media empire — which includes Viacom and CBS — when he’s out of the picture.
The duo want the Massachusetts Probate and Family Court to rule, in a hearing this Thursday, that it has the authority — and justification — to order an examination of Redstone, 93, to determine whether he’s competent to manage his affairs.
If Viacom’s controlling shareholder is deemed incompetent, then the court could block a May 20 effort to eject Dauman and Abrams from the Redstone family trust and the board of National Amusements.
The seven-member trust will control Redstone’s 80% stake in National Amusements when he’s incapable of managing it. The theater chain owns 80% of the voting shares in Viacom and CBS.
Redstone’s team says that he’s still calling the shots, that Dauman and Abrams haven’t proven otherwise, and that any question about his competence should be decided by a court in California, where he now lives.
But today’s filing says that Dauman and Abrams have “more than met their pleading obligations” to show that Redstone’s actions are “based on undue influence” by Shari, who’s President of National Amusements and Vice Chair of Viacom.
“She has isolated Mr. Redstone and seized control of all facets of his life,” the filing says. In the process, she is “upending his carefully crafted and longstanding succession plan for leavingt control of his companies in the hands of independent trustees. and by replacing those trustees with individuals who are beholden to Shari.”
If she prevails, then she can “do as she pleased with [National Amusements], CBS and Viacom.”
The document takes a swipe at David Andelman, a member of the trust who was widely seen as a swing vote — but recently sided with Shari.
Now that he has “aligned himself with Shari Redstone, [he] may deny that he is a professional fiduciary, and if he does, Plaintiffs are at least entitled to expedited discovery to test such a denial.”
It adds that he “has chosen to reveal nothing about his own conduct in Massachusetts” for the trust,” including “the records he maintains in his office in Massachusetts.”
In a separate filing, Abrams describes the history of the Redstone trust and why he believes it should be assessed by a Massachusetts court.
“The Trust is a Massachusetts trust and was from its inception,” he says. “All the significant actions and connections of the Trust are tied to Massachusetts. Not only was the Trust the product of a Massachusetts divorce action and approved by the Massachusetts Probate Court, the Trust was negotiated, drafted, and executed in Massachusetts.”
He adds that shares of National Amusements, “the only asset of the Trust have never been held in California.”
Redstone’s lawyers say that it would be too burdensome for him to deal with a court case a continent away.
But Dauman and Abrams say that it’s “highly unlikely that he will appear in any courthouse.” A medical exam, “which may turn out to be crucial evidence in this case, would need to be conducted in his home by video regardless of the legal forum.”
Today’s filing also notes that a judgement about Redstone’s competence is central to a separate case at Delaware”s Chancery Court where Viacom is challenging National Amusements’ move to change the bylaws and replace five directors.
Redstone “may not be long available to be examined or to give testimony for this case,” today’s filing says.
What’s more, if Dauman and Abrams are correct in their assertion that Redstone is being manipulated, then “individuals who have taken part in the scheme alleged here may well be adjudicated unqualified to continue serving as trustees” to run his media empire.
Related stories
Sumner Redstone Face-To-Face Rejected By Viacom Board, Mogul's Reps Claim
BET Awards Viewership Rises Over 2015 With Simulcast On 12 Viacom Nets
Viacom Asks Courts To Order Immediate Sumner Redstone Exam
Get more from Deadline.com: Follow us on Twitter, Facebook, Newsletter
