Drama, drama, drama — that’s what’s currently dominating the company that owns Comedy Central.
In-fighting at the tippy top of Viacom (and above) has the industry watching while the media giant reels. Bickering and posturing between company chairman, president and CEO Philippe Dauman and chairman emeritus Sumner Redstone’s daughter Shari is nothing new — but below are seven things in this ongoing war that are.
Sumner Redstone asks court to confirm his trustee changes
On Monday, Redstone petitioned a California court to confirm Friday’s action to remove Dauman and George Abrams from the National Amusements Trust, which controls CBS and Viacom.
“Mr. Redstone has been clear and unequivocal in his desire to remove Philippe Dauman and George Abrams as trustees,” said his attorney Robert N. Klieger. “Mr. Redstone is saddened that Mr. Dauman is trying to make this dispute about his daughter. This dispute is not about Shari Redstone. It is about Mr. Redstone’s right to have the individuals he wants and trusts managing his assets upon his death, and protecting the financial interests of his grandchildren.”
“It is telling that Mr. Dauman is raising the question of mental capacity for the first time after he’s been removed when, just months ago in court documents, he pronounced Mr. Redstone ‘engaged, attentive, and as opinionated as ever,'” Klieger concluded.
In a statement later on Monday, Dauman’s attorney Les Fagen said, “It is outrageous for the new complaint and recent statements to rely on Mr. Dauman’s affidavit from last fall. Mr. Dauman stated only that Mr. Redstone was alert and attentive during two brief meetings last fall … Mr. Dauman never commented as to Mr. Redstone’s competence on any matter, at any time, much less his ability to make conclusive decisions about complex issues concerning large public companies.”
Dauman and Abrams file lawsuit to overturn Friday’s ousting
Dauman and Abrams aren’t taking their removal from the seven-member Sumner Redstone Trust and National Amusements board that controls both Viacom and CBS lying down. The two filed a lawsuit on Monday morning asking a judge to overturn Friday’s shocking decision. The duo believes that the 92-year-old Redstone is not in control of his mental faculties, and that daughter Shari is making a power play.
Dauman attacked the move as “invalid and unlawful,” accusing Sumner’s daughter Shari Redstone of “unlawfully” manipulating her dad’s signature.
Shari clearly did not want Sumner’s protege Dauman to take her father’s chairman role at Viacom, but the board overruled her earlier this year. The posturing — and nastiness — has continued since then. Dauman and Abrams also assert that Shari has blocked them from meeting with her father to discuss the happenings.
Read more about that side’s lawsuit here.
The remaining trustees are now: Norman Jacobs, Sumner’s divorce lawyer; Leonard Lewin, an attorney who represented Redstone’s first wife, Phyllis, in her divorce from Sumner; Shari Redstone; Shari’s son, lawyer Tyler Korff; and David Andelman, another lawyer who has worked with the Redstone family and is on the CBS board.
Shari Redstone denies manipulating her father, calls Viacom accusations “absurd”
Shari Redstone does not appreciate Dauman and Viacom’s assertion that she’s pulling strings from behind the scenes, signing off on things in her media mogul father’s name.
“It is absurd for anyone to accuse Shari of manipulating her father or controlling what goes on in his household,” Shari’s spokesperson said in a statement on Monday morning. “Sumner makes his own decisions regarding whom he wants to see both in his home and elsewhere, and he has his own team of independent advisors to counsel him on corporate and other matters.”
“As to the idea that Shari, an attorney and respected businesswoman, would ‘unlawfully’ use his name, that is utterly ridiculous,” the statement concluded.
Media analyst says either Dauman or Les Moonves must go
BTIG Research’s Rich Greenfield thinks Dauman will probably end up fired from Viacom — but if he isn’t, maybe it’ll actually be CBS head honcho Leslie Moonves who gets the axe. It’ll take a heck of an effort on Dauman’s end, but who would be shocked by anything in this dysfunctional situation at this point?
“We have a strong belief that if Shari Redstone gains control of the SMR Trust (meaning she has at least three other votes to gain majority control of the seven votes), Philippe Dauman’s days are numbered,” Greenfield wrote on a Monday blog post. “On the other hand, if Philippe Dauman has majority control, we wonder what the future looks like for Les Moonves, particularly as he is viewed as an ally of Shari Redstone.”
Of course, CBS is currently experiencing much higher levels of success than Dauman’s Viacom, so this alternative feels like a long shot.
Sumner Redstone says he opposes Paramount sale
Sumner Redstone apparently wants people to know two things: 1. It was his decision to oust Dauman and Abrams; and 2. He’s not down with selling Paramount Pictures. At least, that’s what his spokesperson said on Sunday.
“Mr. Redstone removed Mr. Dauman and George Abrams as trustees of the Sumner M. Redstone National Amusements Trust and as directors of National Amusements, Inc. based on what Mr. Redstone believes are the best interests of beneficiaries and shareholders,” Mike Lawrence said yesterday.
“Mr. Redstone continues to believe that it is in the best interest of Viacom that Paramount Pictures should remain wholly owned by the parent company,” the statement continued. Mr. Redstone regrets that Mr. Dauman has diverted resources to these baseless attacks and misrepresentations, rather than focusing on the continuing challenges that are faced by Viacom. Mr. Redstone will continue to act in what he believes are the best interest of Viacom’s shareholders.”
Read more about that here.
As far as what one can expect coming down the pike, TheWrap has a few predictions. First, Shari Redstone’s camp will probably respond to Dauman’s Monday lawsuit — could a counter-suit be waged? Readers can likely hold their breath on the next fighting words, as they haven’t taken very long to materialize over the last few days.
Simultaneously, the Viacom/Dauman side will likely reply swiftly to Sumner Redstone’s attempt for court affirmation. Then it’ll be the court’s turn, which could take some time. After that, well, maybe Dauman gets dropped, or perhaps Shari Redstone is overthrown — and maybe Viacom and CBS become one again, reversing a 2005 split.
Will Paramount Pictures be sold? It all depends on who is in charge. Right now, it’s Advantage: Shari, and thus “probably not” on the film arm sell-off. Currently, VIAB is cruising along unharmed, but that’ll be something to keep an eye on as well.