Shari Redstone Complains About Lack of Information on Paramount Deal

Shari Redstone Viacom Fight
Ryan Stone

Shari Redstone complained in court filings today that Viacom executives have not kept her in the loop regarding a potential sale of a minority stake in Paramount Pictures.

The claim seemed to confirm the widely held view that she is taking a more assertive role in managing the business affairs of her ailing father, Viacom mogul Sumner Redstone. Viacom CEO Philippe Dauman and his allies have alleged that Shari Redstone is in fact manipulating her father and acting against his true wishes. For her part, Shari Redstone has been at pains to present her father as fully in charge.

The filings in Delaware court accompanied today’s move to oust Dauman and four others from the Viacom board. In a motion for expedited hearings, lawyers for Viacom’s controlling stockholder, National Amusements Inc. — of which Sumner Redstone owns 80% and Shari Redstone owns 20% — alleged that Dauman has ignored Sumner Redstone’s wishes regarding the Paramount sale.

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According to the filing, Sumner Redstone has repeatedly stated that Paramount — which has sometimes called “my baby” — should remain wholly owned by Viacom. Nevertheless, Dauman has pushed ahead with plans for a sale of 49% of the studio. In March, the company stated it had received interest from dozens of potential suitors. The next month, it said it had narrowed the field to a handful of bidders and projected to close the deal by the end of June.

Shari Redstone sits on the Viacom board, but according to the filing she was kept in the dark about the sale. On June 1, she filed a formal request under Delaware law for detailed information regarding the potential transaction. However, she alleges that she was denied access to most of the information, leaving her unable “to evaluate or to craft an informed view” on the deal.

NAI also filed a motion in Delaware court to preserve the “status quo,” in large measure to prevent Dauman and his allies from selling a stake in Paramount.

Dauman is also fighting the Redstone family in Massachusetts court over his removal last month from the NAI board and the Redstone trust. Sumner Redstone is expect to file a motion to dismiss Dauman’s lawsuit on Monday.

Though Redstone has now moved to oust Dauman from three boards in less than a month, Dauman remains — for now — the CEO of Viacom, and one of the highest-paid executives in America. If he is forced out, he is expected to receive tens of millions of dollars in severance.

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