Robert Freedman v. Sumner Redstone

OPINION OF THE COURT

GREENBERG, Circuit Judge.

I. INTRODUCTION

Between 2008 and 2011, Viacom Inc. paid three of its senior executives — Board chairman Sumner Redstone, President and CEO Philippe Dauman, and COO Thomas Dooley — more than $100 million in bonus or incentive compensation. Although the compensation exceeding $1 million paid by a corporation to senior executives is not typically a deductible business expense under federal tax law, a corporate taxpayer may deduct an executive’s otherwise nondeductible compensation over $1 million if an independent committee of the corporation’s board…