Shari Redstone, chairman and chief executive officer of Cinebridge Ventures Inc., speaks during the New York Times DealBook conference in New York, U.S., on Nov. 10, 2016. Photo Credit: Michael Nagle/Bloomberg LP

CBS Corp. on Monday sued to stop controlling stockholder Shari Redstone from pursuing a merger with Viacom, amid fears that she could act quickly to oust the CBS board and force a deal that CBS claims would irreparably harm the company and its investors.

The lawsuit, filed in the Delaware Court of Chancery, seeks a temporary restraining order against Redstone and her family's National Amusements Inc. holding company ahead of a board meeting, scheduled for Thursday, where CBS directors plan to issue a dividend that would reduce Redstone's voting power from approximately 80 percent to just 17 percent.

A hearing on CBS' motion is set for Wednesday afternoon in Wilmington before Chancellor Andre G. Bouchard, the judge's chambers confirmed.

In the complaint, CBS and a special committee of five independent directors accused Redstone of actively trying to undermine the company's management team by seeking a recombination of Viacom and CBS, which are both controlled by the Redstones and National Amusements. Shari Redstone, the daughter of Sumner Redstone, has been pushing for the deal since her ailing father relinquished his role as chairman of CBS and Viacom in February 2016.

CBS said in the filing that the special committee had determined over the past weekend that the move was not in the best interest of its stockholders.

“The special committee believes that once Ms. Redstone learns of this determination, she could assert her power, as she did at Viacom, to immediately replace members of the board and use the new directors to force through the merger on terms favorable to herself and [National Amusements] but harmful to CBS,” CBS's Wachtell, Lipton, Rosen & Katz and Ross Aronstam & Moritz attorneys said in the complaint.

National Amusements responded that it was “outraged” by the lawsuit and denied any intention of replacing CBS' board to force a deal that was not supported by both companies.

“Ensuring the long-term success of CBS continues to be NAI's sole interest,” the company said in a statement.  “This precipitous lawsuit, and the efforts of CBS management and its 'independent' directors to wrest voting control from NAI, are outrageous. We intend to defend our position vigorously and look forward to presenting our arguments in court.”

According to CBS, Redstone first attempted a Viacom-CBS merger in early 2016, but the deal foundered when CBS demanded protections that would limit National Amusements' influence over the combined company.

However, CBS said Redstone relaunched her efforts in January, causing Viacom's stock to soar while CBS' stock plummeted 28 percent from its 52-week high in April, representing a $7 billion loss in market capitalization for CBS' public investors. Meanwhile, CBS said, Redstone has eschewed third-party offers for the company and refused to submit the suggested deal with Viacom to a stockholder vote.

“The refusal even to allow the board to consider such an offer deprived CBS's stockholders of a value-enhancing opportunity that the special committee or the board, not Ms. Redstone, should have been free to evaluate and potentially use as leverage in other negotiations, including the special committee's negotiations with Viacom,” CBS said.

Monday's filing raised the possibility that Redstone would act quickly to take the “feared next step” of replacing the CBS board and management structure in order to force through the merger.

The requested restraining order would block Redstone from altering the composition of CBS' board or otherwise interfering with director decisions ahead of the special meeting on Thursday, just one day before stockholders are set to vote on a slate of nominees for open board positions.

CBS said it plans on Thursday to offer new preferred shares of the company's Class A stock to investors who hold Class B stock in a bid to dilute Redstone's voting power. The maneuver, CBS argued, was “expressly permitted” by the company's charter.

As of Monday afternoon, an online docket-tracking service did not list attorneys for Redstone or National Amusements.

Sumner Redstone was also named as a defendant in the suit. However, recent lawsuits have indicated that the former executive's influence has greatly diminished since his health began to deteriorate in 2014. He still officially serves as chairman emeritus of CBS and chairman and CEO of National Amusements.

The complaint described Redstone's clashes with CBS' chairman and CEO Leslie Moonves, but it also detailed Redstone's scraps with Viacom, where she orchestrated the ouster of former CEO Philippe Dauman and four board members in 2016. Both sides sued in the Court of Chancery seeking an expedited determination of whether the move was valid. The case, however, quickly settled without a ruling on the validity issue.

National Amusements earlier this year issued a public statement expressing support for Moonves, who has overseen CBS' strategy of growing its subscriber base by distributing premium content across a range of platforms. But CBS said her conduct behind the scenes “belies” those words.

“Ms. Redstone's misconduct and interference has made it difficult for the CBS management team installed by the CBS board to effectively manage the company's affairs and implement the board's and management's long-term interests of the company and its shareholders,” the complaint said.

“The special committee believes that Ms. Redstone has already destroyed tremendous stockholder value, and she threatens to do even more harm if she does not get 'her way'—a threat she has made good on at Viacom.”

Redstone could not be reached for comment on Monday.

The five special committee members—Gary L. Countryman, Charles K. Gifford, Bruce S. Gordon, Linda M. Griego and Martha L. Minow— are represented by attorneys from Weil, Gotshal & Manges in New York.

The case is captioned CBS v. National Amusements.