Delaware judge rules for Redstone family in CBS dispute

WILMINGTON, Del (Reuters) - A Delaware judge said on Thursday he would not block Shari Redstone from exerting control over the board of CBS Corp <CBS.N>, which was considering stripping her voting power in defiance of her push to merge the media company with Viacom Inc <VIAB.N>.

The CBS board was scheduled to meet later on Thursday to consider issuing a special dividend that would dilute Redstone's vote to 17 percent from 80 percent.

A CBS special board committee had sought a temporary restraining order from the court because the directors feared Redstone would replace the board before the meeting.

The Redstone family controls both CBS and Viacom through its National Amusements Inc, a movie theater company. National Amusements welcomed the ruling, and said CBS's special committee had breached its fiduciary obligations to CBS shareholders.

"The court’s ruling today represents a vindication of National Amusements’ right to protect its interests," the company said in a statement.

The judge, Chancellor Andre Bouchard, said his ruling does not end the dispute, but that he expected to continue to have oversight of the company's actions, and said Redstone had a fiduciary obligation as a controlling shareholder.

On Wednesday, Shari Redstone used her control over the company to amend the bylaws to essentially block the issuance of a special dividend aimed at cutting her voting power.

Bouchard noted in his ruling he could set aside Redstone's bylaw change if the court finds it invalid or unfair to shareholders.

(Reporting by Tom Hals in Wilmington, Delaware; editing by Jonathan Oatis)

05/17/2018 12:15

News, Photo and Web Search

Search News by Ticker

 

Related Photos