Viacom Judge Says He’s Unsure Redstone Settlement Acceptable

  • Billionaire Redstone’s granddaughter challenging accord
  • Keryn Redstone questions Sumner Redstone’s mental competence

The Massachusetts judge overseeing a court fight between billionaire Sumner Redstone’s granddaughter Keryn and the media mogul said he’s unsure whether he can accept a settlement that will lead to the ouster of Viacom Inc. CEO Philippe Dauman.

Probate Judge George Phelan said at a hearing Friday he was “unclear” whether Keryn Redstone must agree to back Dauman and other Viacom officials in their request to drop their lawsuit.

Because Keryn Redstone has raised questions about her grandfather’s mental status, Redstone, Dauman and another former overseer of a trust set up for the billionaire’s grandchildren “can’t dismiss the action without her consent,” Pierce O’Donnell, Keryn’s lawyer said at the hearing.

Keryn Redstone, 34, daughter of the media mogul’s son Brent, didn’t participate in the settlement talks and has vowed to continue to pursue her lawsuit challenging her 93-year-old grandfather’s mental abilities to resolve legal claims and remove Viacom executives.

Sumner and Shari Redstone, his daughter, had been fighting to remove Dauman from the company and the trust since May, when a judge in Los Angeles dismissed a suit filed by Sumner Redstone’s former caretaker, Manuela Herzer.

Manipulating Daughter

Herzner alleged the billionaire was mentally incompetent and being manipulated by his daughter. Shortly afterward, the Redstones kicked Dauman and fellow board member George Abrams off the trust, setting off a legal battle in three-states.

Keryn Redstone broke ranks with other family members and joined Dauman and Abrams in their lawsuit in Massachusetts. U.S. Probate Judge George Phelan earlier this month set a trial date in September before the settlement was announced last week.

Keryn’s lawyers argued that the settlement “blesses and implements” replacements Jill Krutick and Thaddeus Jankowski as the trust’s new overseers, whom she called in a court filing “cronies operating under Shari’s thumb to manipulate and influence an incapacitated Sumner.”

O’Donnell argued Friday that if Phelan allowed an independent examination of Redstone’s condition, he’d find that the former CEO “doesn’t have a clue about what’s in that settlement agreement.”

Relationship End

If approved, the settlement will end a decades-long relationship between the elder Redstone and Dauman, a corporate attorney who advised Sumner on many of his biggest deals, including the acquisitions of Viacom, Paramount and CBS Corp., and was regularly introduced on company conference calls as the wisest man Redstone had ever known.

The relationship soured this year, after Dauman replaced his mentor as chairman of Viacom and the board eliminated Redstone’s remaining pay. Dauman’s decision to sell a stake in Paramount angered Redstone, who fought a bruising battle to acquire the studio two decades ago. Sumner and his daughter then moved to unseat Dauman from the board and from their family’s business affairs.

The case is Dauman v. Redstone, 16-E0020, Massachusetts Probate and Family Court, Norfolk County (Canton).

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