CBS Files Lawsuit To Block Merger With Viacom – Star Trek Reunification Now In Doubt [UPDATED]

Update: Redstone reacts, considering countersuit

Variety has a statement from Shari Redstone’s National Amusements (NAI), which refutes the CBS claims in their lawsuit. It reads in part:

“National Amusements (NAI) is outraged by the action taken by CBS and strongly refutes its characterization of recent events. NAI had absolutely no intention of replacing the CBS board or forcing a deal that was not supported by both companies. NAI’s conduct throughout supports this, and reflects its commitment to a well-governed process.”

And CBNC is reporting that a deal over the valuation price for Viacom had been agreed, which was a major issue during negotiations. This leaves the disagreement over the management of the company the sole sticking point. They also report that Redstone “could counter sue CBS directors for a breach of loyalty.”

Original article

The potential reunification of CBS and Viacom – which would bring all of Star Trek back under one corporation – may be in jeopardy. The driving force behind the deal has been Shari Redstone, who controls a majority of voting shares in both corporations. However, CBS and its CEO Leslie Moonves have been reluctant, especially with regards to the proposed management structure of the combined company. Today, CBS took a dramatic step, suing Redstone’s National Amusements holding company in an effort to take away her control of CBS.

According to a number of reports, CBS is seeking a temporary restraining order to stop Redstone from making changes to the CBS board in order to push forward her plan for the merger. Even though Redstone had made concessions earlier this month, that does not appear to be enough to satisfy CBS, who are concerned she can use her power to replace board members and force a deal on her terms.

As reported by Variety, the independent directors on the CBS special committee to evaluate the merger “decided this past weekend that a reunion with Viacom is not in the best interests of CBS shareholders.” The suit alleges that Redstone is not acting in the best interest of shareholders and seeks to have her voting shares diluted from 79% to about 17%.

According to CNN, the suit also claims that “Redstone unilaterally, and without Board approval, informed a potential acquirer of CBS to not make an offer for the Company, depriving the board of the opportunity to consider a potentially value-enhancing transaction.” The suit does not identify the “potential acquirer.”

The nature of this dramatic move by CBS indicates there was concern Shari Redstone was prepared to use her power to make the deal happen regardless of the board’s concerns. As noted by the Hollywood Reporter last week, “Shari Redstone ultimately controls both media companies and, like Rupert Murdoch before her, she (and not Leslie Moonves) ultimately will determine the future of a merged film and TV empire.” The lawsuit is a last-ditch effort on the part of CBS to see if there is a way for them to determine their own future without Redstone.

Star Trek could be a casualty of this corporate war

This is certainly a major step backwards for the reunification of CBS and Viacom, owner of Paramount Pictures. Since Viacom split up in 2005, Star Trek has been divided between CBS and Paramount Pictures, with CBS owning the brand and television rights and Paramount owning the film library and holding the rights to make new feature films.

A CBS/Viacom merger could create more opportunities for building the brand, cross-promotions and other synergies. Potentially it could eventually lead to building a coherent ‘Star Trek Cinematic Universe’ across TV and film. For now, any such dreams will have to be put on hold with CBS and Paramount continuing to forge their own independent paths with Star Trek.

TrekMovie will provide updates on this story as the become available.

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59 Comments on "CBS Files Lawsuit To Block Merger With Viacom – Star Trek Reunification Now In Doubt [UPDATED]"

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CBS had no history with Star Trek and Moonves didn’t care one bit about it until Discovery. Every move since the split that has hurt Star Trek and its potential future has been on CBS.

The Redstones should oust Moonves and put Viacom leadership in charge of the company. Paramount has always treated Trek better than CBS, whatever you think of the last three films.

CBS doesn’t deserve Star Trek.

@Mike Stivic — do you really think Viacom is doing all of this for what’s in the best interest’s of Star Trek?

I never suggested they were “doing all this” for Star Trek. I said that in general Paramount was the better parent.

@MS — based on what? Paramount is about to go bankrupt. Everything that used to be Paramount TV became CBS. And lately all Paramount has managed to do is mishandle the film franchise and turn it into a money losing proposition.

I don’t think any of the new Star Trek films lost money.

Rel,

If STAR TREK had the ROI for Paramount that you imagine, how do you account for their going in the hole in the first place? Further, how do you account for their not stopping the bleeding until A QUIET PLACE?

Really? Wasnt it CBS that did a really great job with the DVDs? I think CBS shows greater care for Star Trek than Viacom which bent over backwards for Bad Robot.

CBS is the one that currently has shown they understand the value of their catalog of Trek. Paramount has continually shown they don’t care by repackaging the same old early-2000s HD versions of their Trek catalog movies (with the exception of TWOK).

Even with CBS showing a bit more care, the split has been bad for Trek. When Viacom fractured, the team that used to be there overseeing Trek dissolved, since most were part of the Berman-era team.

Because of the split, any comparison to the Paramount of yore is basically invalid. When people say “oh Paramount would treat it better”, I have a hunch they’re thinking of the pre-split Paramount. The Paramount that exists today is hardly the entity it once was, and CBS is also a different animal than it was pre-split.

What Matt said.

Paramount is ‘under new management’. It will take some time before they’re able to right the ship.

Yep. They have a long turnaround process ahead of them.

Are you complaining about the image quality of the HD Trek films? Or supplements? They added new commentaries and featurettes, to go with the DVD era supplements, when they issued the Blu-rays circa J.J. Abrams’ Trek ’09, as I recall. Nothing amazing, but there’s only so much one can say about The Search for Spock and the Nexus. Though I guess they could offer more in the way of, say, HD humpback whale featurettes or perhaps A Conversation with Laurence Luckinbill. Christopher Plummer Looks Back on His 2004 Interview About The Undiscovered Country? They could do an HD director’s recut of The Motion Picture, but that would be a pricy proposition.

No not about supplements, they put some money into bonus features for the TOS and TNG Blu-ray movie sets released in 2009.

This about the movies themselves. They’re all based on very old transfers from the early 2000s. The transfers were initially used for DVD releases, and don’t hold up well to modern scrutiny.

Considering the market for SF and Trek in particular, I think it took them forever to come up with semi-decent extras, and they really blew it in that an awful lot of people died before they got them interviewed, and that goes right back to them not caring in the 90s. They should have had a year-long project of going round the country doing comprehensive interviews — and I know they can’t say they didn’t ever consider it, since they solicited my proposal for that — that they could have leveraged for ‘art of’ and ‘making of’ books as well as other media, but instead, nada.

The transfers and preservation/restoration efforts are particularly lamentable, especially since one of the preservation guru people is associated with Paramount. But nothing every really gets done in a thorough future proofing way.

Paramount never handled the TREK features with any respect after TMP, and that extends to homevid, like the bare-bones laserdiscs (they were even late with issuing widescreen versions) … shoot, they were so in bean-counter mode that they actually cancelled TUC early in 91 over a difference of a million bucks on the budget, and it took Jaffe suggesting that they eliminate ILM from the budget to bring it down before Paramount finally relented a bit.

They’ve been in bean counter mode ever since they took over Desilu…. and trying to get a decent budget has been like getting blood out of a stone…..

Paramount completely bungled the promotion for Star Trek Beyond, pretty much relegating it to insignificance before it was even released and completely ignoring the 50th anniversary promotional opportunities.

Before that they completely threw the Trek universe’s continuity out of whack by going along with the Abrams, Orci and Kurtzmann Kelvin-verse movies which are pretty to look at but utterly bereft of any original ideas.

Back in the day of the TOS and TNG movies Paramount was notorious for penny-pinching and generally trying to make as much cash while putting as little money into the movies as possible.

The Star Trek films have often suffered because of bad decisions made by Paramount execs on other movies being made and released as they were often forced to share the burden of reduced budgets and other restrictions despite being one of their few consistent money makers.

So CBS may not deserve Trek, but Paramount deserves it even less.

I get the impression Paramount had little confidence in Beyond, which is why they did a shorter PR campaign.

I imagine Orci’s ideas (which included Nimoy & Shatner) were much more akin to a 50th Anni Celebration. Once Paramount got cold feet about a big Trek idea, they clearly decided there was no point to spending money on a 50th campaign to help advertise a film that did nothing for the history of the franchise and one that they werent confident in.

STID is the real culprit. Im mystified by Paramount tapping Orci to direct Trek 3 after STID but I think they thought it was better than it was and eventually got cold feet when they realised his story was, like STID, “too Treky” (it wasn’t actually too Treky, it was just terrible).

Had Trek 2 been better, Orci probably gets his way with Trek 3 and we have a 50th that includes Shatner’s return to the franchise.

Instead we got a half baked right wing evil Cheney story crossed with a “our Dark Knight” rip off mess that effectively set the franchise back, ruined the 50th Anni and created the sense that Trek 4 needs to take a big step back.

What could have been…

Beyond was fine but the marketing push behind it, and virtually everything leading up to it, was reflective of where Paramount was at that time. Ceding control to third parties is what ultimately set the franchise back. “Into Darkness” should have been in theaters in 2011, not 2013. Momentum on the rebooted franchise was slowed considerably as a result.

Paramount soured on Orci because he drinks in excess and espouses conspiracy theories online. Paramount’s Marketing Department was gutted by defections/poaching and the decline of the late Brad Grey. STID to STB also represents the transition from an ousted President [dude green lit MONSTER TRUCKS based on his son’s idea, seriously] to the dedicated Star Trek executive Elizabeth Raposo as the new and current President.

I think its possible the studio actually realized what STID was about but figured Orci was smart enough to realize that it didnt work and then he turned in his Trek 3 script and they knew he wasnt.

I never got that “too Treky” explanation. Isn’t it a good thing to be Treky? Weren’t they making a Trek movie? I think they were just condescending Trekkies and Star Trek in general by using that excuse. I think more Trekkies should have felt insulted by it. Being something too “Trekky” is not bad in my opinion.

Apparently, they wanted Trek to be a wee bit more like Guardians Of The Galaxy…

All the movies were successful except for Beyond, they all made money. The one thing they don’t have under control is the budget or a Disney like plan to release a film evey couple years.

There’s a huge price attached to Moonves if he’s pushed out and Star Trek is just a small part of the merger as a whole.

Correct. While we Trekkies like to think Trek is going to be a big motivating factor in all this. It’s really not. These battles about merging are about the overall business, the various executive egos, and perceptions of which is the more valuable company.

You’ve nailed it.

CBS was responsible for keeping Star Trek Online on track, and making sure the game was canon accurate. They also forbid Abbrams from rebooting Star Trek the way he did Star Wars.

I hope Redstone is victorious and ousts Moonves. He cares little for TREK and it’s legacy, only the $$$$.

I feel Redstone understands the importance of a unified company and in the long run, would benefit TREK.

@Luther Sloan — you understand that Paramount is merely a licensee of Star Trek for the purpose of making feature films? Yes Viacom has managed their assets so well that they have run the company to the edge of bankruptcy. CBS is correct in being concerned what merging with such a poorly run company would have have on their very successful operations. What would be in the best interests of Star Trek is if CBS would take back their licensed rights, and act on them themselves. If CBS offered cash-strapped Paramount a substantial offer for their Star Trek feature film catalogue, and unified the entire catalogue under one umbrella, it would be both good for Trek and Paramount. Merging an unprofitable company with a highly profitable one without giving the better company a controlling interest would be the mistake here. Instead, Viacom is likely going to die on the vine until they are bought up by another major studio, like Sony, and then likely sell the catalogue to CBS anyway in order to mitigate the cost of such a major purchase.

@Cadet – and why dont they? It makes such obvious sense? Paramount might feel like they dont want to give up Star Trek but would the cash infusion be good PLUS, couldn’t CBS produce films that Paramount distributes, thus being a win-win?

Except that Viacom has turned around over the past 12 months. Paramount is the weak link but turning a studio around takes several years at best.

I find it odd that people complain that “so and so only cares about $$$.” Newsflash… That is EXACTLY what they should care about. Businesses do not survive if they don’t make money. End of story.

That said, there is a happy median that can be achieved where a beloved franchise can be cared for while the business side STILL makes their money. Achieving that balance does take an effort, however.

@ML – if you believe that why have you railed against CBS airing Discovery on All Access rather then “free” TV?

Just look at all the network shows that got canceled last week. Thank goodness Discovery is on Streaming.

Among your many mistakes here Luther is your insane belief that anyone every involved with Trek has cared about more than money. They didn’t, any of them, Gene included. The only vision he ever had was dollar signs.

Which one is clutching the Saurian Brandy and overacting?

OverShat-ning

Whatever the end result of this will be, I want a good product from all the parties involved and not just something produced for the simple act of putting butts in seats. I don’t want a fast food, I want an excellent Italian cuisine.

It’s so adorable when corporations get “outraged.” It’s like they think they’re people.

I don’t see why they don’t work out a deal that brings the franchise under one umbrella anyway. Just like Marvel worked out a deal for Spider-man, it seems logical that all versions of Trek can be under one roof.

@BBKP — They could if they wanted to. All CBS has to do is not renew the licensing deal they’ve extended to Paramount. Then it would be more like the Star Wars/Fox situation where Disney owns everything going forward, but FOX still has the original film rights (which is why Disney is buying them in part). Eventually CBS could work out a deal to rejoin the original films with the rest of the TV catalogue.

The answer to your question is bundled up in what you said. Marvel has a studio head (Kevin Feige) that oversees the entire Marvel Cinematic Universe, they’re motivated to make things cohesive, and have the vast resources of Disney to throw money at it to make it happen. There is no such person in either CBS or Paramount. They have no unifying vision, nor do they have a leader to try to make it happen, and neither of them have the money to throw at the other to work out a deal (assuming both parties would even be open to it).

Wait, what? Shari Redstone is doing exactly that, reuniting the two halves of Viacom that Sumner split because his idiot COO didn’t have the foresight to oust the late Brad Grey and hand Moonves the keys. I am in no position to give Paramount an autopsy in some general sense, but it does have one person in control of Star Trek and she was promoted to President of Production, Liz Raposo. The three films represent her ascent, i.e. she was most influential on BEYOND. She worked for and eventually ran Darren Aronofsky’s company Protozoa ca2007 before ascending at Paramount. Furthermore your statement that neither of them have the money is silly: Shari Redstone owns both companies.

You’re missing the context here. This was more about one company buying the other out from their Trek properties. As they exist today, that wouldn’t happen.

What Redstone is doing of course makes all that moot, but that didn’t seem to be what BringBackKirkPrime was asking. I interpreted it as: “regardless of if CBS and Viacom merge, why can’t they work out just merging Trek back?” and I outlined why just trying to merge Trek on its own won’t really happen.

Thanks for that Matt

@Matt — you’ve made a valid point, but going forward, CBS could absolutely unify TV and feature Trek, merely by withholding the feature licensing rights from Paramount upon renewal, and keeping them for themselves.

Ultimately, I feel it comes down to money.

Sony was screwing up Spider-Man, and they saw a big time money making opportunity to bring Spidey into the Marvel world. Marvel without Spidey is like DC without Superman.

It’s in the best interest of everyone for Spidey to be a part of the Avengers’ world. I feel the same with all Marvel characters that we haven’t seen yet like the X Men.

I think one big problem with Star Trek is that whoever would be in charge would not have the right vision–or at least, over the years, from Berman to Abrams, I have never seen anyone get it right (other than fan films which obviously don’t have the actors and budget to pull off that vision).

But I guess that’s another topic.

The point is, even without a Kevin Feige, the only thing stopping Star Trek from being combined is negotiation. I don’t think Paramount and CBS have to merge to make it happen–they just have to see the dollar signs and just do it.

@BBKP — right, but that’s the problem … Paramount doesn’t want to share the wealth, which is arguably why we ended up with the Bad Robot films and little to no merchandising. Paramount tried to re-brand Trek for itself, and Abrams demanded CBS stop merchandising Prime Trek. It’s not for lack of seeing the dollar signs, its the greed with which the various parties see the dollar signs. Guys like Abrams want all of the dollars for themselves, and Paramount went right along with the plan. CBS agreed to not produce a new Trek series to give the Bad Robot movies the spotlight, but that wasn’t enough for them. CBS is doing what’s right for Trek. The best case scenario is to take the licensing rights back from Paramount, get rid of Abrams, and go it alone with Trek. Otherwise, a merger is the best way to re-unify Trek.

all i am hoping for is that the kelvin-verse movies and st:d are killed/put to death/obliterated. they’re all so terrible. hopefully new trek springs up in their place that is akin to what we got trek-wise prior to 2005.

No Grooified No

DADBLAST IT!

Doesn’t make any difference anyhow. The TV shows and movies should be separate.

She owns 79% of the voting stock… Good luck, Les…

This is about as bad as that Unification TNG episode.

I assumed NAI had WAY more power and pull than seems the case. More fool them for splitting up old Viacom in the first place.

Speaking of lawsuits, does anyone know what’s going on with the Axanar production? From what I gather, they’re continuing with the project, presumably with edits in comportment with the settlement vis-a-vis Paramount & CBS. But that leaves an awful lot of questions. What’s the new story like? Did they start from scratch, wiping everything Trek-like? What’s it going to look like? If they’re not allowed to have Klingons, Vulcans, Star Fleet ships and uniforms, etc… then, what sort of analogues are they using? Has their visual fx guy designed brand new ships, etc… from scratch? Are they even still allowed to call the thing “Axanar?” Anybody have any updates on this? I’m awful curious.

Business news reporting Shari has prevailed against Les.