Tuesday, January 17, 2023
The Getty family has gone to battle against a former financial advisor, Marlena Sonn, who has given the world a glimpse inside the workings of the Getty dynasty. The dispute began over a tax strategy rooted in the physical geography of family members to avoid paying California taxes.
Sonn built her career by representing progressive, ultra-high-net-worth millennials and women in an industry known for its “bro culture,” and helps her clients align their financial strategy with their progressive ideologies. She was connected to Gordon Getty’s daughters Sarah and Kendalle, and built strong personal relationships with them over an eight year period likened to that of mother-daughter relationships.
The falling out began when she wrote the sisters about her concerns over a tax strategy deployed by the family. Around this time, she was removed from her position at the corporate entities that represented the sister's interests in Pleiades Trust and during severance negotiations, the personal relationships soured. As the negations further declined, Sonn filed suit in the Eastern District of New York.
Darien Shanske, a law professor at U.C. Davis, has characterized the Gettys’ tax approach as “aggressive, obnoxious tax planning.” It appears the strategy might simply be taking their chances with California’s version of the IRS, the Franchise Tax Board. Like many state agencies, F.T.B. can only take on so many complex cases, and with current legal uncertainties and a well-financed opponent, F.T.B. may just decide to settle rather than rigorously pursue the family.
Everyone involved has felt the ramifications of the falling out. Sarah Getty told reporters that this has impacted her ability to trust those around her, while Sonn’s career in finance is virtually over.
For more information see Evan Osnos “The Getty Family’s Trust Issues”, The New Yorker, January 16, 2023.
Special thanks to Kent D. Schenkel (Professor of Law, New England Law) and Deborah Matthews (Virginia Estate Planning Attorney) for bringing this article to my attention.