Robin Williams died on August 11, 2014, and it did not take long for litigation to be filed over his estate, or more specifically, his living trust. Mr. Williams last rewrote his trust in January 2012, not long after marrying his current wife. Mr. Williams had three children, none of which were from his current marriage. Published reports reveal a number of interesting issues, some of which are unique to “celebrity” estates, but most of which apply to all estate planning.
Lesson #1: If litigation erupts over your estate plan, your living trust, otherwise a private document, will be made public. The basic reason for having a living trust as your primary estate planning document is to avoid a cumbersome Probate Court proceeding to probate your Will. But even with a living trust, if litigation starts, your trust document will have to be filed with the court and will be public knowledge. The attorney for Mr. Williams’ widow apparently tried to file a redacted copy of the Robin Williams Trust with the court, but the court insisted that he file an unredacted copy. Now everyone can see the document.
Lesson #2: The privacy of your family can be seriously invaded by the litigation in unintended ways. Some websites published the unredacted trust document in its entirety, which contained the exact street addresses of Mr. Williams’ two Northern California homes, one in Napa, the other in Tiburon. That cannot be a good result for anyone.
Lesson #3: Even moreso than money, personal property is the match that lights the fuse. The current litigation is not over millions of dollars, but over Mr. Williams’ personal property, including items as mundane as his wedding tuxedo and as potentially valuable as his entertainment industry awards and memorabilia. The dispute centers around whether the trust provision granting certain items to Mr. Williams’ children limits them only to certain items in one of Mr. Williams’ two homes. There also are accusations back and forth about items being improperly taken or disposed of by one or more parties, and complaints from Mrs. Williams about the trustees’ purportedly heavy-handed tactics.
In any estate, particularly but not uniquely a celebrity’s estate, in which “tangible personal property,” from clothes, to jewelry, to art, to antiques, baseball card collections, and so on, have great financial or emotional value, it is important to carefully consider who receives which items. It also is critical to think about whether there could be any confusion over the definition of what constitutes any particular class of items. This is particularly true when, as in the Williams case, the surviving spouse is not the parent of the decedent’s children, and the surviving spouse is going to continue to occupy what could turn out to be an empty house. Moreover, the trustees carrying out the plan must walk a very fine line between securing, inventorying, valuing and distributing the property in accordance with the trust provisions, and triggering the very raw emotions attached to the decedent’s personal items.
Lesson #4: the Michael Jackson estate tax dispute has the attention of planners of celebrities’ estates. In California and many other states, a deceased celebrity’s “right of publicity” (the celebrity’s name, likeness, voice, signature and photograph) is a property right which can be exploited and protected after death (in California, for 70 years thereafter). Until the last several years, the IRS did not appear to pay much attention to the estate tax value of a deceased celebrity’s right of publicity. However, the IRS is currently engaged in litigation with the estate of Michael Jackson over the value of Mr. Jackson’s right of publicity (among other issues), in which the IRS is seeking literally hundreds of millions of dollars in estate tax. According to published reports, Mr. Jackson’s executors valued his right of publicity at only a couple of thousand dollars, while the IRS claims it to be worth over $434 million.
Perhaps aware of this, in the 2012 revision of his trust, Mr. Williams and his advisors made moot the issue of the estate tax value of Mr. Williams name, likeness, etc. In his trust, Mr. Williams left his right of publicity to the Windfall Foundation, which he and his former wife started. There is an unlimited estate tax deduction for money or property left to a qualified charity, so it does not matter whether Mr. Williams’ right of publicity is worth $1,000 or $100,000,000.
Finally, Mr. Williams’ trust forbids the Windfall Foundation from exploiting his right of publicity for 25 years following his death. While this provision will not prevent movies in which he appeared from being shown or distributed by streaming services, it will prevent his name and image from being used in advertisements, and it will foreclose his images being digitally inserted into new television shows or films. It is not clear why he gave these rights to charity and then made them useless until August 2039, when they may not produce any income for the charity, instead of allowing these rights to be exploited currently, but restricting certain uses (e.g., no commercials for certain products).