Sumner Redstone's Mental Capacity A Concern As Court Holds Viacom Plan

(RTTNews) - Viacom Inc.'s (VIAB, VIA) controlling shareholder Sumner Redstone's mental competency needs to be determined before taking a decision on his plan to replace five directors at the media giant, a Delaware court said Wednesday.

During a hearing, Delaware Chancery Court Judge Andre Bouchard said that he won't fast track lawsuits filed by Redstone and Viacom directors over the removal of five board members last week.

The judge said he would wait until the result of another case in Massachusetts regarding 93-year-old Redstone's competency to make decisions, before deciding on the proposed board changes. The Massachusetts case is through its discovery process. Redstone's mental health is being assessed in lawsuits in three states.

Last week, National Amusements Inc., Redstone's holding company to control Viacom, filed its lawsuit to affirm its board replacements. In response, Viacom's lead independent director Frederic Salerno filed a suit to invalidate the dismissals, which included himself and the company's chairman and chief executive Philippe Dauman.

In the Delaware dispute, both sides were asked to maintain the status quo during the legal process. The existing Viacom board would continue to manage the company day-to-day, but won't be able to take any actions outside of the ordinary course of business.

The Massachusetts case is related to the removal of Dauman and Viacom board member George Abrams from a trust that will oversee Redstone's media empire, which also includes CBS corp. (CBS), after he dies or is determined to be incapacitated.

In the Massachusetts case, a hearing is scheduled for June 30.

Viacom's next board meeting is scheduled on August 3 in New York.