Delaware Judge Deals Major Blow to CBS in Dispute with Chief Sha - WBOC-TV 16, Delmarvas News Leader, FOX 21 -

Delaware Judge Deals Major Blow to CBS in Dispute with Chief Shareholder

Posted: May 17, 2018 11:56 AM Updated:
CBS Corporation sues its stakeholder, National Amusements, in a fight for independent control. CBS Corporation sues its stakeholder, National Amusements, in a fight for independent control.

DOVER, Del. (WBOC)- A judge in Delaware's Court of Chancery has ruled against CBS in a major dispute with its majority shareholder that could decide control of the company.

Chancellor Andre Bouchard on Thursday denied a temporary restraining order prohibiting National Amusements and its president Shari Redstone from taking any action to thwart a scheduled vote later in the day by members of the Board of Directors on a dividend that would dilute National Amusement's voting power from nearly 80 percent to 17 percent, effectively giving CBS independence.

In his ruling, Bouchard also said he was lifting a temporary restraining order he issued on Wednesday against National Amusements that was intended to protect his jurisdiction.

CBS has been pushing back against pressure by National Amusements to merge with Viacom, which also is controlled by National Amusements.

In a statement released Thursday afternoon following Bouchard's ruling, CBS and the Special Committee of its Board of Directors said, “The judge today found that the allegations in our lawsuit ‘are sufficient to state a colorable claim for breach of fiduciary duty against Ms. Redstone and NAI as CBS’s controlling stockholder.’ We could not agree more. While we are disappointed that the judge did not grant a TRO, the ruling clearly recognizes that we may bring further legal action to challenge any actions by NAI that we consider to be unlawful, and we will do so. We remain confident that we will prevail in the lawsuit previously filed by CBS and the members of its Special Committee.   

“As previously announced, the CBS Board will hold a meeting at 5 p.m. today to consider declaring a dividend of shares of Class A common stock to all of the Company’s Class A and Class B stockholders, as is permitted under CBS’ charter. This dividend would more closely align economic and voting interests of CBS stockholders without diluting the economic interests of any stockholder.”

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