Inside the complicated world of Sumner Redstone and his media empire
Viacom’s founder and owner, 93-year-old billionaire Sumner Redstone, has had a tumultuous few years wrapped up in a never ending series of legal battles involving various members of his family in a fight for ownership of the empire.
Sumner Redstone
In August a settlement was reached ending the battle between the businessman and his daughter Shari Redstone, against directors at Viacom and granddaughter Keryn Redstone, who entered the battle in June. It meant Sumner Redstone took complete control of the $40bn media company - which owns MTV, Comedy Central, Nickelodeon and Paramount Pictures - and CBS.
While the settlement called an end to the ownership battle, which saw its chief executive Philippe Dauman ousted, the war still rages as questions circle around the mogul’s mental capacity, and his vulnerability to be dictated to, or taken advantage of.
Now Redstone is suing two of his ex-girlfriends for civil claims including elder abuse, claiming he was forced to borrow $100m from the private company that holds his voting shares of CBS and Viacom to cover tax obligations on gifts he gave to the women.
The lawsuit, filed in Los Angeles Superior Court, seeks around $150m that Redstone’s lawyers say he gave to Manuela Herzer and Sydney Holland. In the lawsuit filed on Tuesday, Redstone says Herzer and Holland engaged in a years-long scheme to drain his wealth by running up credit card bills, selling stock and changing his estate plan.
Herzer and Holland allegedly persuaded Redstone to sell his assets in National Amusements, which owns 80% of the voting shares of CBS and Viacom. Selling these generated about $100m in after-tax income, the lawsuit said. Redstone then gave $45m each to Herzer and Holland.
This triggered matching tax obligations of more than $90m, forcing Redstone to borrow $100m from National Amusements to cover it, the lawsuit said, "because Holland and Herzer had cleaned out Redstone's bank accounts."
The lawsuit is the newest battle in a nearly year-long litigation war between the Redstone and Herzer.
Ronald Richards, an attorney for Herzer, said the lawsuit has no merit. “All of the gifts Mr. Redstone made to my client and to Sydney Holland were made with his full knowledge and blessing,” he said. He affirmed that Redstone is now being manipulated by his family, and that Herzer hopes his true mental state will emerge during the course of the lawsuit.
In a statement a spokesperson representing Holland called the lawsuit "fictional revisionist history" and asserted that doctors have testified twice in recent months that Sumner Redstone was of sound mind and, most recently, that he was mentally competent to make such critical and complex business decisions as orchestrating the departure of his long-serving chief executive at Viacom, changing its Board of Directors and, currently, exploring a merger between CBS and Viacom.
"This is directly contradicted by the claims in this lawsuit that state that Mr. Redstone’s physical and mental state were so impaired that he could be easily manipulated. Both cannot be true," the spokesperson said.