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Redstone Lawyers Fight Incompetency Claims - Broadcasting & Cable

Redstone Lawyers Fight Incompetency Claims

Viacom CEO Dauman says chairman retains mental acuity
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Lawyers for 92-year-old Sumner Redstone, who controls CBS and Viacom, denied accusations that he is incompetent to make decisions about his health care and finances.

Redstone, who has famously stated that he does not plan to die, has said that both companies will be managed by a trust when he is gone. But uncertainty about the future of both companies is prevalent on Wall Street and elsewhere.

Redstone has been seen in public rarely recently and no longer speaks on earnings conference calls. He suffers from impaired mobility and a substantial speech impairment that leaves him difficult to understand, according to his lawyers. But he still has capacity to make decision and execute documents, they say in court papers.

The new questions we raised in legal actions brought by Manuela Herzer, a long-time confident and companion of Redstone’s who was evicted from his home in October. Herzer was also removed as the person who would oversee Redstone’s health care if he is incapacitated.

She was replaced with Philippe Dauman, CEO of Viacom, who is a trustee of the trust that will manage his interests in CBS and Viacom.

In court papers, Herzer’s lawyers say “it is clear to our client that in the past few weeks Sumner Redstone has become incompetent to handle any decisions relating to his health care, finances, or other decision-making for that matter. We also believe that he may be the victim of undue influence or fraud, and that he did not make the decisions relating to Manuela of his own free and independent will.”

Herzer engaged in a battle over her getting clothes and other personal effects from Redstone’s home. The two sides came to an agreement to resolve the matter. That agreement was approved and signed by Redstone.

Redstone’s lawyers say the charges are not about Redstone’s health care but about other changes made in various trusts that previously benefited Herzer. “

This application is all about Ms. Herzer’s personal financial agenda. Mr. Redstone kicked Ms. Herzer out of his house on Oct. 12, 2015, and since then, Ms. Herzer has been on a warpath. Why? Because she suspected that in the days or weeks following her removal from his home, Mr. Redstone would take action to amend his estate plan, and that whatever benefit might have previously accrued to her would be eliminated,” they say in court papers.

Redstone’s lawyers say he has the best medical care money can buy.

“This litigation is a farce, and it should be summarily dismissed,” Redstone’s lawyers said. “If Ms. Herzer wants to challenge Mr. Redstone’s estate plan, the very least she could do is wait until he dies.

Among the documents submitted by Redstone’s attorney is a statement from Dauman.

“Although Sumner has a substantial speech impairment, I speak with Sumner several times a week by telephone regarding both business and personal matters. I also visit him in person on a monthly basis. I am in regular touch with members of his household staff and with his primary care physician, Dr. Gold,” Dauman said.

Dauman said he visited Redstone on Nov. 3 at his home and spent about 90 minutes with him. “Sumner told me that Manuela has been threatening to litigate and that all she wants is his money,” Dauman said in a statement. “Sumner and I spoke about business matters, including the upcoming Viacom board meeting. Sumner asked me to send regard to various people, and I updated him on the regards others have asked me to pass along to him. We talked about the conference at which I would be speaking the following morning, and we reminisced about corporate history and personal matters. We also watched some basketball together and talked about a movie he had most recently screened.”

Dauman said he’d previously seen Redstone in person on Oct. 8. Herzer was present for much of that visit, Dauman said. “We had an extensive business discussion regarding articles that had appeared recentily in the New York Times and the Wall Street Journal, and we also discussed personal matters,” Dauman said. “Manuela did not at this time—or ever—express any concern to me about Sumner’s cognative ability.”

Dauman said that Redstone’s mental acuity appeared to be unchanged between their October meeting and the one in November. “On both occasions, he was engaged, attentive and opinionated as ever.”

According to Redstone’s primary physician Dr. Richard Gold, Redstone’s ability to make medical decisions has been consistent over the two years he had treated Redstone.

Dr. Gold said Redstone had a CAT scan of his brain and throat in the last two weeks. The scan showed no evidence of a stroke and minimal, if any, atrophy. “Overall Mr. Redstone’s brand scan was quite good for a 92-year-old,” Gold said.

Redstone’s lawyers also included a statement from Dr. James Spar, who does research on elderly patients with mental illness and has evaluated the mental capacity of patients in 1,500 cases. Spar examined Redstone most recently on Oct. 15.

“It is my profession opinion that Mr. Redstone retained the capacity to execute the estate planning documents he siged that day, including documents that eliminated Manuela Herzer as his nominated conservator and successor agent pursuant to an Advanced Health Care Directive,” Dr. Spar said.

“The decisions Mr. Redstone described and endorsed during the evaluation appeared to reflect his own, authentic wishes and not the influence of his staff member or anyone else,” Dr. Spar said.

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