Just returned from a week in the Caribbean. The British Virgin Islands are special. Post to follow soon. Meanwhile, here is the family pic from Cooper Island Beach Club.
Viacom and CBS President, Sumner Redstone, is back in the news this week. He removed Phillipe Dauman and George Abrams, who are directors of Viacom, as Trustees of one of his trusts. They are contesting their removal by alleging he is incompetent. In a huge twist of irony/self-preservation/whatever you want to call it, only six months ago they testified he was competent to remove a girlfriend as his health care proxy.
Three brief points:
1. The stakes in the previous battle involved who could make his health care decisions if he could not (while the real plot was whether he could change his will to disinherit his former girlfriend) while these stakes are who gets to control Viacom and CBS after Redstone’s death.
2. I think if Redstone is in a wheelchair, being fed by a feeding tube, and able to communicate only through an aide now, and was in the same condition six months ago, he was likely incompetent at both junctures.
3. Dauman and Abrams have reaped what they have sown. Being close to Redstone is like having an alligator as a pet – it might seem cool, but eventually it (i.e. he) will devour you.
Hillary Clinton’s recently released financial disclosure statement reveals that she and her husband both created a qualified personal residence trust in 2010 and transferred ownership of their NY home to it. They did not transfer their more expensive Washington DC house to a similar trust.
Several quick educational points:
1. A qualified personal residence trust allows them to transfer the house at a discounted gift tax value based on how long they wish to reside in the house and the current interest rates.
2. For example, if they decided to live in the house for the next 20 years (and not die), they would be able to transfer the entire $1.7 million house to Chelsea while only valuing it at $400K for gift tax purposes.
3. Future appreciation is also excluded from their estate.
4. They would have been wise to transfer the DC property via this technique because that house has doubled in value while the NY property has only increased nominally.
5. While this estate planning technique is available to everyone, I find it hypocritical that a woman campaigning for higher estate taxes and other taxes in the name of the greater good does everything she can to avoid those taxes.
The reports of a settlement between Sumner Redstone and Manuela Herzer over her replacement as his health care proxy were premature. There actually was a brief trial over the dispute which ended with the judge dismissing Herzer’s suit to remain as his health care decision maker. The judge relied on a 7 minute deposition of Redstone in which the few intelligible sentences he uttered were “Manuela is a ****ing bitch” (twice) and “I want Manuela out of my life. Yeah.” Of course Herzer’s attorneys have vowed to appeal.
1. This case remains about Redstone’s will which he changed at the same time as his health care power of attorney. Herzer was reportedly to receive $70 million at his death.
2. Herzer, who smartly declined an offer of marriage from Redstone, has reportedly received $75 million in gifts from him while the woman who did become his second wife only received $10 million because she signed a pre-nup.
3. While Redstone, like the recently deceased Prince, believes he will live forever, at least he has planned for his death by having a will and various trusts.
The ever not so eloquent, Snoop Dogg, was asked this week if he had a will or estate plan. His NSFW response was, “I don’t give a f— when I’m dead. What am I gonna give a f— about? This goin’ on while I’m gone, you know?”
And continuing in his non-King’s English, he added, “Hopefully, I’m a butterfly, I come back and fly around and look at all these motherf—–s fighting over my money and s–t, like, ‘Look at all these dumb motherf—–s.’ Ha!”
Only four sentences, but so many points. Minimizing them:
1. Snoop can make life easier for his loved ones if he spends a bit of time deciding who should inherit the wealth accumulated from his questionable talents. He could eliminate any people claiming to be his illegitmate child by naming people in his will.
2. Prince reportedly has had 900 people come forward for DNA testing claiming to be his haIf-siblings while anyone who can establish that he is Prince’s child, will hit the jackpot and inherit all of Prince’s wealth.
3. Raise your hand sheepishly if you think Snoop has fewer illegitmate children than Prince. You would be wrong.
4. I doubt Snoop views his family as loved ones when he refers to them as “dumb motherf—–s.”
5. Maybe it is just me, but if I were reincarnated, unlike Snoop I would prefer to return as something more fierce and substantial than a short lived insect with pretty wings.
Paul Daugherty allowed me to guest write his TML Blog for the Cincinnati Enquirer. I covered today’s sports news plus a few UC sports issues. I hope you enjoy it.
As mentioned the other day, Prince did not leave a will. A Minnesota court today appointed a corporate trust company as special administrator to manage his affairs and identify his heirs (I can help – his sister, 3 surviving half siblings, and the children of his 2 deceased half-siblings will inherit under law). His estate is rumored to be worth $300 million.
Reports are surfacing that Prince did not leave a will. Of course, it is ludicrous to expect someone to present his will one business day after his death. Still, his longtime attorney and friend said that he did not prepare a will for his Purple Majesty because Prince thought he would live to be 1,999. It is unlikely another attorney prepared a will for Prince. He is survived by a sister and three half-siblings.
Three quick points:
1. Live to be 1,999? At some point the attorney/friend has to say, “Dude, the average American lives to be 78. Add fifteen years for taking care of yourself. Tell me who should inherit your sizable estate and let’s write it down.”
2. Under Ohio law, his estate would pass equally to his sister and half sister (plus any children of his dead half-siblings).
3. If the attorney for Harper Lee were appointed as Executor, we would see various outtakes released as newly discovered material and presumably titled “1998.”
In light of Prince’s untimely death, the below chart is fascinating. Most common age of death for pop stars is 56. Mercifully, the trend line is up. Full story here.
1. Paul Walker’s teenaged daughter settled a wrongful death lawsuit for $10 million against the driver of the Porsche in which he was riding at the time of his death in 2013. The settlement actually occurred nearly 18 months ago, but was only recently reported. Her lawsuit against Porsche for manufacturing an allegedly defective vehicle is still ongoing.
2. Sumner Redstone settled the lawsuit filed by his former girlfriend, Manuela Herzner, questioning his capacity to remove her as his health care surrogate and presumably his capacity to revise his will to omit her. She was allegedly slated to receive $50 million plus an expensive house. The settlement is reportedly for less than $70 million.
3. Last, the Louisiana Supreme Court has ruled that the court records regarding Tom Benson’s competency hearings should remain sealed and unavailable to the public. After the Harper Lee probate judge sealed her estate proceedings, it seems that Southern courts have a proclivity for privacy while their predecessors acted in hooded robes for their secrecy.
David Tepper is a hedge fund manager whose company is located in New Jersey. He is also a resident of the Garden State (misnomer alert). He recently announced that he was moving his corporate headquarters and his personal residence to Florida. The NJ state budget director then stated that this move could affect the amount of tax revenues generated by NJ.
In a topic that is evergreen, an Italian man adopted a boy from Ethiopia in 2007. The boy tragically died of cancer last year at the age of 13. The boy owned an iPhone 6 which both he and his father accessed by finger print ID. After his son died, the father lost access to the phone because he claims the phone restarted during an access attempt. The father has since written to Tim Cook begging him to assist with unlocking the phone so he can see the last two months of his son’s photos and life. Apple has been unable to assist him. In lieu of unlocking the phone, the guy has said he will accept a donation to an orphanage benefiting Ethiopian children.
A Massachusetts man was appointed guardian of his niece and nephew when their parents died in a car crash in 2009. The man was recently indicted for allegedly stealing approximately $250,000 from their trust fund in the 11 months after he was released from rehab. He pleaded not guilty.
Three very quick points:
Paul Daugherty has once again graciously allowed me to guest write his The Morning Line blog for the Cincinnati Enquirer. It is primarily about Mick Cronin. I hope you enjoy it.
Harper Lee, the author of To Kill a Mockingbird, died last month at 89. Since her death, her executor first requested, and received, permission to keep her will private resulting in secrecy regarding the value of estate and her beneficiaries. Last week her executor notified the publisher of the mass market (re: less expensive) version of To Kill a Mockingbird that it would no longer allow the publication of that version of Lee’s beloved novel.
As previously mentioned, Sam Simon was the co-creator of The Simpsons. When he died a year ago, he reportedly left his $100 million estate to various charities. However, various charities he had supported during his life were initially miffed that they had not received support from his trust during the six months after his death. Also, the individual taking care of his Cane Corso was squabbling with the Trustee about receiving insufficient funds to care for the dog. Now, his girlfriend has filed a claim against his estate alleging that Simon had promised her $5 million in his will if she quit her job. His first wife, Jennifer Tilly, also filed a claim against the estate asking to continue to receive payments from his estate for work he did on The Simpsons and the Drew Carey Show.
I am an attorney located in Cincinnati, Ohio who practices in the areas of estate planning, probate, asset protection, and small business advice. I make a difficult and bewildering process as simple as possible. Most importantly, I provide "more for less" for my clients.