Sumner Redstone removes Viacom CEO and
board member from trust
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[May 21, 2016]
By Jessica Toonkel
(Reuters) - Media mogul Sumner Redstone
has removed Viacom <VIAB.O> CEO Philippe Dauman and Viacom board member
George Abrams from the seven-person trust that will determine the fate
of both Viacom and CBS <CBS.N> in the event of his incapacitation or
death, two people familiar with the situation told Reuters Friday.
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Sumner Redstone, executive chairman of CBS Corp. and Viacom, arrives at
the premiere of 'The Guilt Trip' in Los Angeles December 11, 2012.
REUTERS/Fred Prouser/File Photo |
Reuters reported Tuesday that Redstone, who turns 93 next week,
had the power to remove certain members of the trust, including
Dauman.
The move by Sumner Redstone, gives his daughter, Shari Redstone, who
is also on the trust and vice chair of CBS and Viacom, a victory and
more certain control to determine the fate of her father's $40
billion media empire.
According to documents faxed to Dauman and Abrams, Redstone also
removed Abrams and Dauman from the board of National Amusements Inc,
the privately held movie company which owns 80 percent voting stake
in CBS and Viacom, one of the sources said.
Both sources wished to remain anonymous because they are not
permitted to speak to the media.
CBS and Viacom also received faxed notifications, according to
Fortune, which first reported Sumner Redstone's move.
A spokesman for Dauman called the steps "illegal and invalid" in an
emailed statement to Reuters.
"They are a shameful effort by Shari Redstone to seize control by
unlawfully using her ailing father Sumner Redstone's name and
signature. As she knows and as court proceedings and other facts
have demonstrated, Sumner Redstone now lacks the capacity to have
taken these steps," the spokesman said.
"Sumner Redstone would never have summarily dismissed Philippe
Dauman and George Abrams, his trusted friends and advisors for
decades."
Abrams did not immediately respond to an email requesting comment. A
spokeswoman for Shari Redstone had no immediate comment.
Sumner Redstone and Dauman have worked together for more than 30
years, and Redstone has called Dauman "a great friend." Shari
Redstone voted against Dauman's elevation to executive chairman of
Viacom in February.
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This month, a judge dismissed a lawsuit by a former girlfriend who
argued Redstone was not mentally competent to remove her from his
advance healthcare directive last October. The case shined a
spotlight on Redstone's health.
The mogul struggled to speak when questioned by the ex-girlfriend's
attorneys, a transcript of his testimony showed.
The Sumner M. Redstone National Amusements Inc Trust owns about 80
percent of Redstone's privately held movie theater company, National
Amusements Inc, which in turn owns 80 percent of the voting rights
in both Viacom and CBS.
After Sumner Redstone dies or is incapacitated, the trust will
determine all matters that come to a shareholder vote at both
companies, including potential mergers or acquisitions.
With the removal of Abrams and Dauman, Shari Redstone will have
majority support among the trust's members, who include Shari's son,
lawyer Tyler Korff, and David Andelman, another lawyer who is on the
CBS board.
The trust's other members are Norman Jacobs, Sumner's divorce
lawyer, and Leonard Lewin, an attorney who represented Redstone's
first wife, Phyllis, in her divorce from Sumner.
(Reporting by Jessica Toonkel in New York; Additional reporting by
Lisa Richwine in Los Angeles; Editing by Robert Birsel)
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