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Tuesday, December 18, 2018

Judge Orders Redstone Guardian


A California judge on Monday ordered that Sumner Redstone, the controlling shareholder of CBS Corp. and Viacom Inc., be placed under court-appointed guardianship, as part of a yearslong legal battle involving the 95-year-old media mogul’s ex-girlfriend.
At a hearing in Los Angeles Superior Court, Judge David Cowan said he would grant the motion by Mr. Redstone’s grandson, Tyler Korff, for the appointment of a guardian “ad litem,” an independent representative most often used when children or the incapacitated are involved in a legal dispute.
However, the judge said that he was appointing the guardian, not because of Mr. Redstone’s mental capacity, but because of his extreme difficulty speaking, according to lawyers who attended the hearing.
Robert Klieger, Mr. Redstone’s attorney, said the decision had no bearing on the status of Mr. Redstone’s trust, which holds 80% of the shares of National Amusements Inc., a holding company that in turn owns nearly 80% voting stakes in CBS and Viacom.
The trust remains under Mr. Redstone’s sole control until he dies or is deemed incapacitated, at which point it will be overseen by seven trustees, including his daughter, Shari Redstone, and grandson, Mr. Korff.
“The judge appointed, with Sumner’s not opposing, a guardian ad litem solely based on Sumner’s physical disability in the form of Sumner’s speech impairment,” Mr. Klieger said in an interview. “He made no finding, and specifically did not find, that there’s any mental incapacity.”
He added: “This does not trigger the trust. It has no implications whatsoever for National Amusements, CBS or Viacom.”
In the past few years, Mr. Redstone’s deteriorating health has become a significant factor in corporate-governance struggles at the media companies he controls, as well as in litigation with his former companions. Shari Redstone, his daughter, now effectively controls his empire. The Redstone family has maintained that he has ailments but isn’t mentally incapacitated.
In ordering the appointment of the guardian, Judge Cowan denied a request by Mr. Redstone’s ex-girlfriend, Manuela Herzer, to have his mental capacity examined.
For more than three years, Ms. Herzer has been fighting in court against Mr. Redstone’s decision in the fall of 2015 to kick her out of his Beverly Hills, Calif., mansion, remove her as his health-care agent and write her out of his estate plans, alleging that he lacked the mental capacity to make these decisions at the time.
She alleges that a subsequent suit, filed by Mr. Redstone to claw back the $75 million in gifts he gave her, is actually driven by Ms. Redstone, his daughter. Ms. Redstone, through her lawyers, has denied the allegation.
In that litigation, Mr. Redstone’s lawyers have declined to have him deposed, citing his frail health. Ms. Herzer’s lawyer, Ronald Richards, has pointed to this fact, arguing that Mr. Redstone isn’t aware of the litigation being pursued in his name.
“Tyler Korff’s motion for a guardian ad litem got the intended consequences — avoiding an exam by an independent geriatric psychiatrist,” Mr. Richards said in an email. “They knew if a [guardian ad litem] was appointed, then whether Mr. Redstone has capacity would be less important in the judge’s mind.”
He added: “The public and Ms. Herzer have been once again deprived of getting to the truth.”
A trial is set in the probate case — one of several legal battles between Ms. Herzer and the Redstones — for Jan. 14.

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