They’re studying their D&O insurance policies and checking them twice.
That’s the phrase from inside Paramount, whose board and controlling shareholder Shari Redstone are struggling to succeed in a call about settling a $20 billion lawsuit introduced by President Trump over a controversial “60 Minutes” interview with Kamala Harris.
They concern the Paramount board’s so-called Administrators and Officers legal responsibility insurance coverage, generally generally known as D&O, wouldn’t cowl bribery – a cost they may very well be uncovered to if they provide into Trump’s calls for, On The Cash has discovered.
As this column has reported, Redstone is prepared to pay Trump as much as $50 million to settle the case that comes as Trump’s personal Federal Communications Fee is holding up approval of her plan to promote Paramount and its CBS information subsidiary to impartial movie firm Skydance.
Her resolution may come any day now, and Trump is claimed to be receptive to the deal. He just lately settled a libel swimsuit with ABC, forcing Bob Iger, who runs the community’s father or mother firm Disney, to fork over $16 million.
However Disney and ABC aren’t in the course of a merger, and the Paramount fee may very well be seen as a bribe to curry favor with the Trump administration and facilitate the Skydance deal, media executives inform On The Cash.
Compounding the issue for the board and Redstone is that D&O insurance coverage usually doesn’t cowl bribery. There’s a risk of civil fits introduced by shareholders, a doable legal investigation mounted by a Trump-hating prosecutor, and – if the Democrats take the Home and/or the Senate within the midterms – infinite congressional hearings.
“I feel badly for her,” one prime media CEO with direct data of the matter mentioned of Redstone. “She’s really in a tough spot.”
“They’re really worried that they could face civil or even criminal charges and their insurance doesn’t cover the legal expense,” the chief added. “The problem is no one really thinks Trump has a good case and she would be settling to push the deal forward.”
A Redstone spokeswoman declined remark. A Trump authorized adviser declined to remark.
“This lawsuit is completely separate from, and unrelated to, the Skydance transaction and the FCC approval process,” a Paramount spokesperson mentioned in a press release. “We will abide by the legal process to defend our case.”
After all, companies settle with the federal government on a regular basis over regulatory infractions fairly than have interaction in a extra expensive authorized battle. Some media executives say the distinction right here is that Redstone isn’t settling with the federal government, however a single particular person who has huge management over her wealth. Already a number of Democratic lawmakers reminiscent of Vermont socialist Senator Bernie Sanders have warned in regards to the authorized implications of a settlement.
Regardless of the hand wringing, Redstone’s resolution is claimed to be imminent and he or she has informed individuals it’s her choice to settle the matter and transfer on together with her life. The Paramount-Skydance deal is valued at $8 billion. Redstone, 71, has seen her fortune evaporate with the sharp decline in Paramount inventory lately.
If the deal is accomplished, she would stroll away with $2 billion, and protect a modicum of the wealth she inherited from her dad, the late media dealmaker Sumner Redstone.
Trump filed the lawsuit towards CBS final October throughout the warmth of the 2024 presidential election, following a “60 Minutes” interview with Harris, the Democratic nominee. The lawsuit mirrors a grievance filed with the FCC by a conservative authorized group that alleges that the CBS information journal deceptively edited the interview to make Harris’s word-salad solutions sound extra presidential.
CBS has lengthy been accused of left-wing bias, although the First Modification typically supplies a free-speech defend. The Trump FCC, nevertheless, is contending that CBS, which operates over public airwaves versus cable, has a authorized, “public interest” obligation to supply unbiased information protection notably throughout a presidential election.
The FCC is holding up approving the Paramount-Skydance deal and Redstone’s much-needed entry to money because it investigates whether or not “60 Minutes” did certainly tilt the scales in its enhancing and the Trump lawsuit stays lively in Texas federal court docket.
The conservative authorized group generally known as the Heart For American Rights says there’s clear proof of misleading enhancing, pointing to the complete transcript of the Harris interview that exhibits a long-winded, and in its view, much less coherent reply to a coverage query involving the battle in Gaza.
“60 Minutes” denies that it has accomplished something incorrect and says that it often edits interviews for time concerns. Authorized consultants say Trump has weak grounds to sue given 60 Minutes previous practices. However the Trump swimsuit claims the enhancing violates Texas enterprise regulation that makes it unlawful to have interaction in “misleading, or deceptive acts or practices in the conduct of any trade or commerce.”
Along with her evaporating wealth, Redstone faces a steep tax invoice — as a lot as $200 million — stemming from the possession stake she inherited from her father after he died in 2020.
