According to The L-A Times, the money — coming from insurance covering CBS’ officers and directors — will go back into the network’s coffers and not to individual shareholders, according to a Thursday filing in a Delaware court. Such derivative suits are common against corporate boards.
The settlement resolves what may be the last lawsuit over the corporate fallout from Redstone’s physical decline and jockeying over control of CBS — the most-watched network in the United States — and media company Viacom Inc., both owned by the Redstone family.
Redstone, 95, controls CBS and Viacom through his family investment vehicle National Amusements Inc., but his involvement has waned as his health has deteriorated. His daughter Shari Redstone has assumed a larger role on the companies’ boards.
The CBS investors noted Redstone’s mental competence was called into question when reports surfaced in 2014 that he wasn’t attending the network’s board meetings and was having trouble speaking.
A Delaware Chancery Court judge allowed the lawsuit to proceed, ruling in April that the shareholders raised legitimate questions whether CBS’ board agreed to pay Redstone in exchange for “services it allegedly knew that he could not render.”