Battle Over Sumner Redstone's Empire Heads to Trial

Battle Over Sumner Redstone's Empire_Split - H 2016
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Battle Over Sumner Redstone's Empire_Split - H 2016

A Los Angeles judge has set a May 6 date for a case that could determine who will control the 92-year-old mogul's health care, massive fortune and prized media holding.

This story first appeared in the March 18 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.

With Los Angeles judge David Cowan setting a May 6 trial to determine the competency of ailing billionaire Sumner Redstone, the battle for the 92-year-old mogul's media empire is moving closer to a denouement. It's been years since Hollywood has witnessed a fight this epic over the fate of legacy properties — in this case, CBS and Viacom.

Cowan said in his Feb. 29 decision that he needs to hear from witnesses to determine whether Redstone's former companion Manuela Herzer is right in arguing that the frail billionaire lacked the mental capacity to remove her as his health-care representative in October. Redstone's attorneys say he was capable of replacing her with Viacom CEO Philippe Dauman.

Perhaps ominously for Dauman, the judge said at this point, "Nobody is sufficiently in charge of [providing] the ongoing care that Redstone needs," expressing skepticism about whether Dauman or Redstone's daughter, Shari, can do the job.

Redstone's attorneys contend Herzer is pursuing litigation because she stood to inherit assets worth $70 million before his will was changed. The judge said an evaluation by a geriatric psychiatrist hired by Herzer raises "a reasonable question" about the mogul's capacities and provides "details [that] are difficult to read in describing how this man is hanging on to life." He questioned how Dauman, who lives in New York and runs a (troubled) public company, can oversee Redstone's care and noted that Shari lives in Massachusetts — "not around the corner" — despite her contention she's available "at a moment's notice."

The escalating fight comes as Dauman, under pressure from Wall Street, moves toward selling part or all of Paramount, most likely to a Chinese buyer. Meanwhile, he faces a deposition in which Herzer will attempt to discredit his repeated accounts of having had extensive conversations with an engaged Redstone in recent months.

What is clear now is that the time is drawing near when control of Redstone's empire will fall to the seven-person trust that many believe will be controlled by Shari. If so, many industry observers believe Dauman will be out of a job. Whether he has time to work his will with respect to Viacom and Paramount before Shari takes the reins is the $39 billion question.