Thursday, May 28, 2020
The cancellation of live sporting events has been a tough pill to swallow for those who have been stuck in their homes due to the pandemic. While many of us have been complaining about the lack of sports to distract us, we have failed to think about the pro athletes that have been put out of work.
Over the past 10 years, sports telecasts have made up over half of the 199 most-watched primetime programs. NFL games alone accounted for 67 of these telecasts.
With all of their assets and time on their hands, athletes are an attractive target for financial scammers. They too are able to see the market volatility and are possibly worried about the economy and may feel that their assets are threatened. The status of athletes and entertainers makes them an easy target for scammers to make new pitches and with the economy and future in limbo, it may be hard for them to say "no."
There are a few practices to keep in mind while advising clients that may find themselves in this situation. First, sometimes doing nothing is the best method of action. It sounds crazy, but sitting still and having self-control is can be the best method of staying in control. Second, run the numbers and rely on experienced due diligence. Any deals that make unrealistic assumptions about the pace of the economy should receive a high level of scrutiny.
See Noel LaMontagne Advising Pro Athletes With Their Seasons, Careers On Hold, Financial Advisor, May 27, 2020.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Saturday, May 9, 2020
Mary Pratt, a south paw pitcher in the All-American Girls Professional Baseball League and possibly the last living member of the original Rockford Peaches, passed away at the age of 101. The league, formed during World War II, was immortalized in the beloved film A League of Their Own.
Born November 30, 1918, Pratt graduated in 1936 from Boston University with a degree in physical education and started teaching. In 1943, she joined the inaugural season of the AAGPBL. She played five seasons in the league with Rockford and the Kenosha Comets. After her departure from the league, Pratt remained active in sports, officiating basketball, softball, field hockey and lacrosse games, and even served on the league's board of directors.
See Rockford Peaches Pitcher Mary Pratt of 'A League of Their Own' Fame Dies at 101, ESPN, May 9, 2020.
Saturday, March 21, 2020
Kobe Bryant had set up a trust before his untimely death to provide for his widow, Vanessa, and their daughters, one of which perished alongside him in a helicopter crash in January. The trust was created in 2003 and amended several times, the last in 2017. The couple's most recent child, Capri, was born in 2019. Vanessa has filed to amend the problem, requesting that the infant daughter be added to the trust.
The trust agreement is reportedly set up to allow Vanessa and her daughters to draw from the principal and income during Vanessa’s lifetime, with the remainder going to the children upon Vanessa’s death. The widow is arguing that according to the trust document, Kobe's intent was to provide for all their children. The other two surviving children of the couple are Natalia, 16, and Bianka, 2.
Vanessa has also filed a lawsuit against the helicopter company that owned the vehicle in which her husband and daughter died and has demanded the deletion of reported graphic photos taken and distributed by deputies through her lawyer.
See Jack Baer, Report: Vanessa Bryant Files to Add Infant Daughter to Kobe's Trust, Yahoo Sports, March 19, 2020; see also Ralph R. Ortega, Kobe Bryant's Widow Seeks to Amend His Trust to Include Daughter Capri, Daily Mail, March 18, 2020.
Special thanks to Jim Hartnett, Jr. (Dallas, Texas Probate Attorney) and Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing these articles to my attention.
Monday, January 27, 2020
The sudden death of basketball star Kobe Bryant sent shockwaves not only through the realm of sports, but through the world. Bryant, 41, was killed yesterday when the helicopter he was on crashed near Calabasas, California, along with his 13-year-old daughter, Gianna, and seven other individuals. But the man was more than a basketball player as he was showcasing his business mind with investments and other ventures.
In 2013, before he retired from the NBA, Bryant co-founded venture capital firm Bryant Stibel along with Web.com founder Jeff Stibel. The firm now has more than $2 billion in assets, with investments in dozens of technology, media and data companies, including Fortnite creator Epic Games, digital payment company Klarna and household products firm The Honest Company. Outside of Bryant Stibel, he had seen a return of millions of dollars with his investment in the sports drink Body Armor, which sold a stake to Coca Cola in 2018.
In 2016, Bryant founded Granity Studios, a media company that focuses on creative storytelling around sports. He wrote and narrated the short story Dear Basketball through the company, winning the Academy Award for best animated short film in 2018, and also released a series of books for young adults.
Bryant, along with LeBron James and Carmelo Anthony, signed a deal with Nike in 2003 when Michael Jordan retired. Nike put out multiple lines of Kobe shoes and gear. In 2017, the company brought Bryant on stage with then-CEO Mark Parker at its annual investor meeting to celebrate the launch of Nike's new business strategy. Bryant then began to grow his own brand, "Black Mamba," which was his nickname on the court. In a partnership with Nike, Bryant launched the "Mamba League" in 2017, a youth basketball league that allows hundreds of kids free access to the sport.
See Clare Duffy and Alexis Benveniste, Kobe Bryant Leaves Behind a Business Empire that Stretched Beyond the Basketball Court, CNN, January 26, 2020.
Tuesday, November 12, 2019
When putting together a will, often times people diligently lay out a laundry list of specific requests that have immense sentimental value. The gifts could involve cars, jewelry passed down through the family, or pieces of art. But for those that share a special pastime of watching sports with a child or other beneficiary, the ability to pass on season tickets might be one of the most memorable and meaningful component of an estate plan. Depending on the sports program, this ability could be attainable.
- Detroit Lions
- Season tickets can be transferred with prior approval of the ticket office, but partial transfers or subdividing accounts are generally not approved.
- Michigan Wolverines
- Officially, only a surviving spouse can be transferred season tickets, but the office may be willing to work with other family members. Since 2015, tickets can be transferred while alive during the month of December, with a nonrefundable transfer fee. Parking and priority points (used for bowl and away games) are not transferrable.
- Michigan State Spartans
- During life or at death, season tickets can only be transferred to the ticket holder's spouse, unless the holder has acquired special permission.
For other states' professional and collegiate teams, be sure to inquire about their season ticket policies.
See Rebecca K. Wrock, Season Ticket Transfers and Estate Planning: Football, Varnum Law, November 11, 2019.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Sunday, September 15, 2019
The 2009 trust created by Pat Bowlen to ensure a succession plan for the ownership of his professional football franchise, the Denver Broncos, is now being attacked in court. Two of his daughters, Beth Bowlen Wallace and Amie Klemmer, are claiming the validity of the Patrick D. Bowlen Trust on the grounds that their father lacked the capacity to form the trust and that he was under undue influence at the time of its creation.
Essentially, the trustees choose one of Bowlen's 7 children to control and run the team. It is widely believed that 29-year-old Brittany Bowlen unofficially has been selected by the trustees, and that it’s just a matter of time before the selection occurs. Previously, the court had dismissed an action by Bowlen's brother brother - acting on behalf of Wallace and Klemmer - that questioned the authority of the three trustees who have managed the team since 2013.
Wallace and Klemmer claim that their father was first diagnosed with Alzheimer's in 2006, three years before the creation of the trust, and that he no longer had the capacity to do so. The stakes are high for the daughters, though; they could end up being completely disinherited by fighting the trust. So they are putting their portions of their father's estate on the line in order to challenge the current structure for determining control of the Broncos.
See Mike Florio, Two of Pat Bowlen’s Daughters Take Legal Action to Challenge Ownership Trust, Pro Football Talk-NBC Sports, September 13, 2019.
Special thanks to Jim Hartnett, Jr. (Dallas, Texas Probate Attorney) for bringing this article to my attention.
Friday, April 26, 2019
Article on Winning Starts at the Top: Estate Planning Considerations for the Modern Day Sports Team Owner
Duncan Ternus recently published an Article entitled, Winning Starts at the Top: Estate Planning Considerations for the Modern Day Sports Team Owner, Wills, Trusts, & Estates Law eJournal (2019). Provided below is an abstract of the Article.
Professional sports team owners need to carefully plan their estates in order to win on and off the field. These individuals are arguably the most important figures in a professional sports team because their actions affect everyone associated with the team, from players to fans. Team owners represent some of the wealthiest people in America and have large estates that often include other business ventures besides their sports teams. When team owners take inadequate estate planning steps, their estates are often forced to sell their teams in order to pay estate taxes. This in turn can lead to team instability or, worst case scenario from a fan’s perspective, a forced relocation of the team.
This comment examines some of the ways today’s professional sports team owners can plan their estates in order to not only continue their personal success but their team’s success as well. Federal estate taxes are the largest hurdle for team owners because the tax affects only the wealthiest of estates, and planning one’s estate to avoid these estate taxes is vital for a team owners’ success. The future of the federal estate tax remains to be seen under the Trump administration, which could lead to substantial gain for team owners should the tax be repealed altogether. Team owners also need to consider state estate taxes for the states in which they are domiciled.
Over the past few years, notable professional sports team owners’ estates have experienced varying degrees of success. This comment will examine in detail the estates of Tom Benson and the New Orleans Saints and Pelicans, Ralph Wilson and the Buffalo Bills, William Davidson and the Detroit Pistons, and Jerry Buss and the Los Angeles Lakers. This comment also provides many strategies for sports team owners to limit their estate taxes, such as use of gift giving, charitable donations, family limited partnerships, and irrevocable life insurance trusts. A family business plan can also ensure a stable transition of ownership when the owner dies and passes the team to the family.
Wednesday, April 24, 2019
The news is littered with professional sports stars earning millions and millions of dollars on contracts and endorsements and then for everything to come crushing back down on them. Once their personal fortunes are exhausted it is nearly impossible to recuperate what they once had, or even to be back on sturdy ground.
The reasons these superstars' wealth goes up in smoke can be devolved into three reasons: overspending, unsound financial advice, and a mixture of both. Overspending is not usually the sole reason that these athletes lose so much money, but it is definitely an attributing factor. Bad or deceptive financial advice can easily be determined to be the overwhelming reason why the fortunes are lost, and sometimes the flimsy advice is unintentional. But as Evan Jehle, partner in FFO Business Management & Family Office explains, “There are also quite a few professionals who exploit the naiveté and unsophistication of successful athletes. In these scenarios, the advice that has been given was done to benefit the advisor rather than the athlete.” Astronomically high life insurance policies with premiums that provide substantial commissions to advisors is one example.
Unbridled expenditures in combination with unsound financial advice can eat away at a professional athlete's fortunes, and in many cases, completely eradicate them.
See Russ Alan Prince, Russ Prince: How Pro Athletes Can End Up Losing Their Wealth, Financial Advisor, April 10, 2019.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.) for bringing this article to my attention.
Saturday, February 16, 2019
A rare beauty was found in a basement in Turin, Italy of a mechanic after the owner passed away in November. The mechanic appears to have lowered a rare 1962 Alfa Romeo Giulietta SZ down to the basement with an elevator, and then when the elevated broke, never repaired it. Fewer than 200 of that model are believed to have been made.
The mechanic died with no will and no heirs, so the government was able to claim the rare car. Worked removed the car with a crane and promptly sold it at a nondescript auction house for an incredible $650,000. That’s one of the highest prices ever paid for the model, and above the Hagerty Price Guide estimate for a show-quality example - all of which goes straight to the Italian Treasury.
See Gary Gastelu, Rare Alfa Romeo Stuck in Basement for 35 Years Sold for $650,000 After Owner's Death, Fox News, February 7, 2019.
Thursday, January 24, 2019
Cristiano Ronaldo, a former forward for Real Madrid who recently transferred to Juventus, will avoid serving a 23-month prison sentence for tax fraud. He accepted a suspended sentence but he was also fined €18.8 million ($21.6 million) to settle the case.
Ronaldo requested for a special security measures to avoid the hassle of the press and the public but was denied. He was required to enter the court room through the main entrance for his appearance, which only lasted 15 minutes because it consisted of merely signing previously agreed upon settlement.
Ronaldo denied an accusation in 2017 that he knowingly used a business structure to hide income generated by his image rights in Spain between 2011 and 2014. He testified at the initial trial, saying he had performed no wrongdoing. He also told the judge he felt victimized by the Spanish authorities, which partially prompted the trade to Juventus.
Ronaldo earns an estimated $93m (€80m) a year, according to Forbes, with approximately half coming from image-rights deals with his many sponsors.
See Juventus' Cristiano Ronaldo Fined for Tax Fraud, Avoids Jail Term, ESPN, January 22, 2019.
Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.