After months of feuding, both in public and in private, Tom Benson, owner of the New Orleans Pelicans and New Orleans Saints, filed a federal suit Wednesday in an effort to regain assets in the two teams from his estranged heirs.
The lawsuit originates from a nasty, bitter family feud between Benson, his current wife of 11 years, and his heirs. As far back as 1991, Benson began creating trusts that named his daughter and grandchildren as beneficiaries. Benson continued transferring assets into the trusts as recently as 2014. However, on January 12, 2015, Benson attempted to pull his ownership of the sports teams out of the trusts in exchange for unsecured promissory notes. The move was part of an effort to grant Benson’s current wife, Gayle, whom he married in 2004, control over his business affairs upon his death. Longtime trustee and lawyer Robert Rosenthal rejected the transfer, however, and the beneficiaries filed suit to have Benson declared mentally unfit to oversee his affairs. The results of a court-ordered psychiatric evaluation are expected by Friday.
However, Benson’s latest suit alleges that the trusts allow Benson to swap out assets for equal value at any time and, thus, Rosenthal lacks the authority to reject the transfer.
The outcome of the case will likely come down to:
- Whether the trusts allow Benson to replace assets in the trusts unilaterally;
- Whether Benson lacked capacity to swap out the assets in the trusts; and
- Whether the transfer of assets in the trusts – where Benson attempted to swap ownership in and control over Benson’s various businesses, including the sports team, for unsecured promissory notes in the amount of $556 million – are of equal value.
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