The Wall Street Journal: CBS loses first round in fight against Redstone family

CBS Corp. has lost the first round in a battle to break free from its controlling shareholder, but the legal fight is far from over.

A Delaware judge on Thursday denied CBS’s request for a temporary restraining order against the Redstone family that would have enabled the media company to strip its controlling shareholder of its voting power. The family’s holding National Amusements Inc. controls nearly 80% of the voting power at CBS.

The court found CBS CBS, -4.44%  wouldn’t face irreparable harm without a restraining order, because it has other avenues to pursue legal action if the Redstones remove directors improperly or try to force a merger of CBS with sister media company Viacom Inc. VIAB, +0.57%  in a way that is detrimental to shareholders.

CBS said it still plans to hold a special board meeting at 5 p.m. on Thursday to consider the approval of a stock dividend that would dilute National Amusements’ voting power to 17%. However, National Amusements amended the company’s bylaws on Wednesday to require 90% of board members to approve such a move, a threshold that effectively gives it veto power.

An expanded version of this report appears at WSJ.com.

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