By Lou Ann Anderson
US~Observer Investigative Journalist
The legal profession is not generally well regarded. A particularly heinous sub-culture surrounds the probate industry in which lawyers and select clients (wannabe heirs, disgruntled family members, etc.) use probate venues and/or estate planning instruments (wills, trusts, guardianships) to perpetrate Involuntary Redistribution of Assets (IRA) actions – or more simply put, to loot assets of the dead or disabled/incapacitated.
IRA actions found in high profile cases often parallel the looting acts perpetrated on estates of far less value. These high profile cases can establish precedents – both good and bad – that impact people at all levels of the economic spectrum. It’s important to understand these “infamous” cases as similar scenarios could play out in your life.
Brooke Astor, a woman known to appreciate beauty in many life venues, apparently spent her last years being exploited by her son, Tony Marshall. Marshall and lawyer Francis X. Morrissey Jr. are accused of looting Astor’s nearly $200 million estate of cash, art and real estate. Marshall is believed to have gifted himself money, disposed of property and fired staff in a manner contrary to Brooke’s wishes. Upon enlisting the assistance of Francis X. Morrissey, the actions to take over Brooke’s estate only became more aggressive and even include allegations of forging her signature on key estate documents. A Vanity Fair piece by John Richardson describes the IRA actions related to Brooke’s estate and is highly recommended reading.
When her grandson and other friends intervened to “rescue” Brooke, the situation had surpassed financial elder abuse and appeared to have elements of physical and mental/emotional abuse as well. Brooke Astor was one of America ‘s most famous women. She had financial and personal resources far exceeding the average person. Nonetheless, she became an IRA target as well as an elder abuse victim. The motivation and tactics used on Brooke are also utilized daily on people with far less resources. IRA and other elder abuse happened to Brooke Astor. It can happen to you.
Leona Helmsley, by most accounts, was a truly unpleasant person. With her August 2007 death, although it shouldn’t make a difference, Leona’s widely-acknowledged graceless demeanor seems to shade discussions regarding the distribution of her assets. Jeffrey Toobin recently wrote a piece for The New Yorker entitled Rich Bitch . He describes how Leona came to leave her estate, in the form of the Leona M. and Harry B. Helmsley Charitable Trust with an estimated value of $3 – 8 billion, “to the provision of care for dogs” along with another catch-all category granting broader discretion to the trustees. Despite Leona providing clear direction, some involved seemed to think they deserved a portion of the estate and others elected to change the terms – contrary to Leona’s final wishes.
Leona had four grandchildren. Two were included in her will as well as made executors (along with others) of her estate. Two were excluded from any inheritance. The first estate contest was from the two disinherited grandchildren, but was settled quickly as estate executors “amended the will.”
The idea that executors would change a will to include otherwise omitted heirs is cause for concern. Per news reports, this move was approved by the New York Attorney General as well as a judge. It established a precedent for disregarding the final wishes of a decedent and jeopardizing inheritance rights of named heirs. This legal point is now likely to surface in other probate disputes as rationalization for discounting clear intentions expressed in a will. It happened to Leona, it can happen to you.
Along with the will “amendment,” the $12 million set aside for the care of Trouble, Leona’s Maltese, was reduced to $2 million. Upon Trouble’s death, unused money was designated to be transferred into the Helmsley charitable trust. Why, once again, was a legal precedent established in which a decedent’s expressed wishes were disregarded? In due time, the same outcome would have been achieved yet with a course that included honoring Leona’s wishes. Why then would a judge blatantly choose to disrespect a person’s final wishes? As said before, Leona Helmsley’s reputation of being a rude, mean and arrogant woman was likely deserved. Regardless, though, an ugly personality isn’t grounds to usurp basic property rights including final distribution of one’s assets.
As the primary “victim” of Involuntary Redistribution of Assets (IRA) cases is dead or if alive, disabled or incapacitated, any defense is usually relegated to designated beneficiaries – often other family members – who then can become targets of legal action. E. Pierce Marshall, the son of J. Howard Marshall II, became such a target in the case of Marshall v. Marshall and its parallel Texas suit, Marshall v. MacIntyre.
Pierce Marshall’s stepmother Vickie – also known as Anna Nicole Smith – was unhappy that her husband did not provide for her in his estate plan. After J. Howard Marshall II spent several million dollars on Vickie/Anna in the three years prior to their marriage and another $6.7 million during the 14-month marriage, she claimed he verbally promised to leave her half of his assets valued by some up to $1.6 billion. This oral commitment was not reflected in six wills and seven other estate planning documents filed in courthouses throughout Texas by a man (J. Howard Marshall II) intent on his distribution wishes being available and well documented for proper execution. His family and circle of friends/employees were aware that J. Howard Marshall II was providing generously for Vickie/Anna during his lifetime in lieu of making her an estate beneficiary.
J. Howard Marshall II died in 1995 and with this, the unhappy Vickie/Anna, a woman who lived off but not with her husband during their brief marriage, initiated legal action that continues today. In fact, it appears no less than 13 separate pieces of litigation were filed within 12 months of J. Howard Marshall II’s death with litigants ranging from disgruntled academic institutions (Haverford College v. MacIntyre), to American Express, Neiman Marcus, bankrupt former business associates and even J. Howard Marshall III, the elder son.
The facts of this matter would seem clear-cut such that little should be open for dispute yet this case has traveled from a Harris County (TX) Probate Court to several California courts and then to the U.S. Supreme Court only to be returned and now currently under review by the 9th Circuit Court of Appeals on remand from the U.S. Supreme Court.
The final outcome of Marshall v. Marshall could impact the property rights of all Americans. In addition to an apparent desire for fame, fortune and the spotlight, Vickie/Anna always wanted to be taken seriously. Who knew that she might ultimately become the woman responsible for drastically eroding American inheritance rights!
The legal gamesmanship and incredible proceedings of Marshall v. Marshall offer lessons on how IRA practitioners use the legal system. Much has been written on the subject including a web site chronicling the entire case . In gathering common sense information relating this complicated case to more modest estates, numerous media accounts and other documents were reviewed. The Harris County Probate Court trial ( Marshall v. MacIntyre) ran from September 2000 through March 2001 and, being the most extensive, detailed proceeding, serves as the basis for our analysis.
Vickie/Anna’s claim for half of the Marshall estate was based upon an oral promise she alleged that J. Howard Marshall II made. He told her, but no one else. No physical evidence existed to support the claim – just her word that he had made a promise.
Texas probate law has long recognized properly executed – written – probate documents as the determinant in final distributions of assets. Moreover, Texas probate law specifically prohibits oral agreements to make a will (§ 59A). Vickie/Anna claimed that not only was she entitled to half of J. Howard Marshall’s estate, but she accused Marshall ‘s designated heir and younger son, Pierce Marshall, of tortious interference with her receipt of the alleged gift. This set the stage for Marshall v. MacIntyre, and later Marshall v. Marshall . If a court upholds Vickie/Anna’s claim based on an unsubstantiated “commitment,” this sets a precedent within the state that unconfirmed oral promises can actually supersede written wills. Given the legal industry’s enthusiasm for GAL (Generate-Administrate-Litigate) strategies, this could pave the way for all sorts of alleged claims while simultaneously destroying any ability of individuals to designate the final distribution of their property.
In the years prior to the probate court trial, it appears that Vickie/Anna and her legal team began to doubt prospects for success in the Houston courtroom. To offset a potential defeat and mounting debt caused in part by a series of Vickie/Anna-as-a-defendant lawsuits, she also filed for bankruptcy in her home state of California .
Some legal observers viewed this as a “venue shopping” move in which a complainant actively seeks out a judge and/or court venue anticipated to be more friendly to a particular case. Pierce Marshall intervened in the bankruptcy proceedings to protect his interest in a 1995 lawsuit in which Vickie/Anna and two attorneys were sued and ordered to pay damages for libel over comments made to the media (E. Pierce Marshall v. Diana Marshall et al).
The California “second front” of this dispute generated more legal gamesmanship. In October 1999, the Houston Chronicle wrote about a ruling earlier in the year in which (California) U.S. Bankruptcy Judge Samuel Bufford ruled that Vickie/Anna and Pierce Marshall were entitled to “share equally” in the estate and Koch Industries (the company in which Marshall had significant interest). Per the Chronicle, “Bufford’s decision was not based on the merits, but as a way to sanction E. Pierce Marshall, 60, the younger of two sons, for allegedly destroying evidence and not showing up for depositions.” This was the first move that granted any legitimacy to Vickie/Anna’s claim and it wasn’t based on the merits of the case??? The awarding of $449 million or more was based on punishment for one of the court participants?
Other mind-boggling aspects of this case include how Judge Bufford withdrew his ruling in January 2000, but then reinstated it in September 2000, one day prior to jury selection starting in the Harris County Probate Court case. The issue of jurisdiction had long been debated as J. Howard Marshall II lived in Texas . His estate would generally be viewed as subject to Texas law, but this California judge was now dictating the distribution of his assets – and doing so not because of the case’s merits, but as a sanction – punishment – for one of the principals! IRA cases are good at taking on a life of their own. This one sure did — and the form taken was nothing short of a monster with more details available at EstateofDenial.com. The points addressed are issues or actions which surface or have relevance to estate disputes (or potential disputes) of average Americans.
Sadly, Pierce Marshall died in June 2006. The legal battle was continuing as was his commitment to honoring his father’s final wishes. And despite Vickie/Anna’s 2007 death, judicial decisions made after the Houston trial continue to be under review.
Did Vickie/Anna really believe that Pierce Marshall committed tortious interference and denied receipt of her alleged gift? We certainly don’t know and to a degree, it doesn’t matter. Speculation can be defined as “engagement in business transactions involving considerable risk but offering the chance of large gains, especially trading in commodities, stocks, etc., in the hope of profit from changes in the market price.”
Sound familiar? We’re not lawyers, but a common sense, practical view says that Vickie/Anna, Marshall III and their attorneys knew that making this claim against Pierce could be lucrative. When these cases get going, reality becomes unimportant and the truth takes a back seat to the legal gamesmanship. In our opinion, these 15 years of litigation have been about nothing more than attempting to use an unsubstantiated claim and the legal system to extort assets received via a legitimate inheritance. It’s that simple, it’s that ugly and it happens every day.
Involuntary Redistribution of Assets practitioners target estates of all sizes and most people have neither the financial means nor general wherewithal to fight such an action. As this point is never lost on prospective asset looters, people must become vigilant. Those who initiate or participate in IRA actions are heinous individuals compromised both in their ethics and morals. Their behavior is in no way excusable, but it should be studied so as to understand with what you are dealing – that their creation of an uneven or chaotic playing field is far more important than any legitimate case merits. Pierce Marshall learned this, as have many other IRA targets.
Despite significant resources, the Marshall family has been unsuccessful in ending their legal and financial assault. Brooke Astor would never have anticipated her assets being looted. And with an estate plan intact, Leona Helmsley would not have foreseen her will being “amended.” This should give pause for concern as new IRA cases surface daily. Many people’s economic welfare has already been harmed due to current economic turmoil and ever-increasing taxation. Now, estate assets once thought to be yours or your prospective heirs may not stay that way due to speculative efforts of disgruntled family members or others perceiving some “entitlement.” Widespread exposure of this problem is critical. No inoculation for Involuntary Redistribution of Assets exists, but as we always say, forewarned is forearmed.