Sunday, February 23, 2014

Cincinnati Pride

No celebrity wills and probate today, instead a bit of love for Cincinnati.  National Geographic Traveler noticed all of the energy and happenings in town from 21 C Hotel to OTR and from Rhinegeist Brewery to the American Sign Museum.  A former NYC resident now living in town said, "Cincinnati has gone from musty to must see."  So true.  Walk taller and with your chest out, Cincinnati.

Wednesday, February 19, 2014

Philip Seymour Hoffman Will

The will of Philip Seymour Hoffman was admitted to probate this week.  Despite sloppy media reporting about a trust for his son (I am looking at you Reuters and New York Daily News), the will left all of his $35 million estimated estate to his girlfriend, and mother of his 3 children, Mimi O'Donnell.  The will also had an unusual request that his son be raised in NYC, San Francisco, or Chicago.  The will was signed before the birth of his 2 daughters.

Several points:

1.  Wills should be reviewed after the birth of a child to ensure that the new baby is included and to ensure that the proposed guardian can adequately care for the additional child.

2.  Hoffman's estate will owe approximately $12 million in federal estate taxes on the 9 month anniversary of his death.  The tax could have been delayed until the death of Mimi O'Donnell due to the use of the marital deduction if they had been married.

3.  If the mainstream media will not employ fact checkers, I am available for $300 per hour to review and advise them on wills of famous people.

4.  The 55 unused bags of heroin in his apartment were not addressed by the will.

5.  NYC, Chicago, and San Francisco?  Apparently diversity is good, but does not include being exposed to Republicans.

Saturday, February 15, 2014

Fast, Furious, and Thriller

As noted earlier, when Paul Walker's executor filed his will with the probate court, he estimated his future income at $8 million and this total estate at $25 million.  Also, as noted last Fall, the Executors of Michael Jackson's estate are battling the IRS over the value of his estate, which they declared to be only $7 million but the IRS contends is worth more than $1 billion.  The discrepancy stems largely over the value of MJ's likeness for commercial purposes (t shirts, merchandise) and the value of his musical catalog which also includes Beatles songs.  His estate valued them at $2,100 and $0 respectively.  The IRS valued them at a combined $900 million.

Several points:

1.  If Paul Walker will earn $8 million post-mortem, a $7 million valuation for Jackson's estate is ludicrous.

2.  The King of Pop grossed $160 million in 2013, more than any other celebrity belying the low valuation of his music if not his likeness.

3.  I doubt that the image of a deceased entertainer with MJ's murky past is worth $450 million, but it is worth more than $2,100.

4.  It might seem like the IRS "won't stop 'til it gets enough" and the issues are "black or white," but the estate's stated values are "bad" if not "dangerous" and could make his family "scream" if they do not "beat it."

Tuesday, February 11, 2014

Fast, Furious, and Admitted to Probate

The will of "Fast and Furious" star, Paul Walker, was admitted to probate last week.  The 2001 document has garnered some media attention because it appoints his father as executor of his $25 million estate which he left to a trust and designates his mother as guardian of his daughter, Meadow Rain, even though her mother survived her.   His estate consists of $10 million of investments, a house with $8.5 million equity, and projected $8 million residuals from his movies.

Several points:

1.  In split household situations, the biological parent will almost always be the sole guardian of a minor child even if the will designates someone else.

2.  In split household situations, I always designate a guardian for the minor children, although I condition it on the other parent being unable  to provide a stable home environment.

3.  Mr. Walker could have avoided the probate process on his investments by adding a transfer on death (TOD) designation to his trust.

4.  Meadow Rain?  In the annals of names of celebrity children it is probably better than Apple Martin and Blue Ivy Carter, and definitely better than Peaches Honeyblossom Geldof, Fifi Trixibelle Geldof, Moon Unit Zappa, and Diva Muffin Zappa but falls short of Tallulah Willis and Scout Willis.

Tuesday, February 4, 2014

Rock and Roll Lawsuits Never Die

Bill Graham was a famous concert promoter who died in a helicopter crash in 1991.   His estate sold his company, Bill Graham Enterprises, in 1997.  Prior to selling the company, the estate transferred his copyrights and trademarks, including the rights to famous concert posters, to the company.  His sons, who each inherited $10 million, sued the executor in Federal Court in 2010 for not disclosing the sale to them.  The sons allegedly discovered the sale while rummaging through their father's business records in '09.  The suit was initially dismissed because the 4 year statute of limitations had long expired, but the 9th Circuit said that the case may proceed to trial.  

Several points:

1.  Probate is a state court matter.  I do not know why this is in federal court unless the attorneys were counting on the 9th Circuit to make an out of left field ruling in their favor.

2.  Of course a business transaction that looks good in 1997 might be viewed as less savvy in 2010.
3.  I suspect that the sons had depleted most of their inheritance and were actually rummaging for dollars when they "discovered" the sale of the property.