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Viacom Head Claims Bronfman Reneged

November 01, 1996|Bloomberg Business News

WILMINGTON, Del. — Viacom Inc. Chairman Sumner Redstone said Seagram Co. Chief Executive Edgar Bronfman Jr. was a negotiator with an ever-changing agenda who would "walk away" from agreements with him as soon as they were reached.

Testifying in a Delaware Chancery Court trial over their USA Network partnership dispute, Redstone also took a poke at Bronfman's competence, saying Bronfman told Redstone he was backing out of an agreement because he misunderstood it.

Seagram unit MCA Inc. sued Viacom in late April, charging that Viacom's recent launch of Nick at Nite TV Land and its ownership of MTV, Nickelodeon and other ad-supported cable networks violates the USA partnership agreement. The agreement specifies that partners can't own cable networks outside the partnership.

Viacom claims that because it became a partner through its acquisition of Paramount Communications Inc. in 1994, it is permitted to own its cable networks because they had already existed.

Redstone said he agreed on Feb. 12 to allow former Viacom Chief Executive Frank Biondi to work at MCA. In exchange, Bronfman allegedly promised not to sue on the claim that Viacom's ownership of MTV and the other networks violated the USA partnership agreement.

Bronfman testified that he had agreed to release Viacom only in regard to TV Land.

On cross-examination, which at times turned to bickering, MCA attorney Herbert Wachtell attempted to show Redstone knew well that Viacom's ownership of cable networks violates the USA agreement.

Redstone said his "common- sense" interpretation of the agreement told him there was no breach.

Redstone said he told Bronfman about the lawsuit: "Edgar, your plan is to disrupt the partnership. You made an agreement, you reneged on an agreement.

"I don't want to be in a position of saying you're not telling the truth, Edgar, but I haven't lost my marbles," Redstone testified he told Bronfman.

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