Saints, Pelicans owner settles case involving heirs' trust
METAIRIE, La. (AP) New Orleans Saints and Pelicans owner Tom Benson has reached a settlement in a lawsuit involving his attempt to remove shares of his pro teams from trusts for his estranged daughter and her two children.
An announcement Friday by the Saints and Pelicans states that terms of the settlement will not be public, but that the NFL and NBA have been informed of ''terms related to the framework'' of the agreement. A federal trial over the matter, which would have made numerous private business documents public, including proprietary financial information that could be sensitive to the NFL and NBA, was slated to open Monday. The 88-year-old Benson also was expected to be compelled to testify at trial.
The Saints and Pelicans have politically sensitive leases to play in state-owned stadiums, allowing the clubs to pay negligible rent while keeping virtually all revenues they generate through tickets, concessions, parking, sponsorships and naming rights. As a related inducement, state offices have paid above-market rents to operate out of a Benson-owned office tower next to the Superdome.
A trial was bound to shed a lot more light on exactly what kind of deal the teams are getting to play in the Superdome and neighboring basketball arena.
In January 2015, Benson announced he no longer wanted daughter Renee Benson and her children, Rita and Ryan LeBlanc, to inherit shares of his pro clubs, and that he intended to replace those shares in the trust with other assets. Benson also stated at that time that he intended to leave the NFL and NBA teams fully in the hand of his third wife, Gayle, whom he married in 2004.
Benson fired his daughter and her children from executive positions with the clubs. Three lawsuits followed in state courts in Texas and Louisiana, and in U.S. District Court in New Orleans. The Texas case was settled in January. Now the federal case has settled as well.
The federal lawsuit involved the rejection by trustees of Tom Benson's proposed asset swap. Benson sought to substitute more than $500 million in mostly promissory notes - some of which would not have come due for more than two decades - in place of non-voting shares in his two pro teams and other businesses interests.
The trustees - Robert Rosenthal and later Mary Rowe - who are required by law to protect the interests of the trust beneficiaries, had said they did not believe Tom Benson had properly demonstrated he was offering a fair and equal swap of assets. Tom Benson then sued in federal court in an attempt to compel the trustees to approve the swap.
''As trustees, our objectives all along have been to protect the integrity of the trusts and to reassure the public that the Saints and Pelicans will continue to call New Orleans home,'' Rosenthal and Rowe said in a joint statement after the settlement.
At the time the family strife began, the heirs' trusts held more than 90 percent of Pelicans non-voting stock and more than half of Saints non-voting stock.
Benson bought the Saints for about $70 million in 1985 and the Pelicans for $338 million in 2012. Financial publications have recently estimated the value of the Saints at more than $1 billion and the Pelicans at more than $600 million.
Perhaps the most contentious of the lawsuits took place in civil court in Louisiana. In that case, the estranged heirs asked a judge to rule Tom Benson mentally incompetent. The lawsuit centered on allegations that Gayle Benson and an inner circle of Saints and Pelicans executives have manipulated an enfeebled Tom Benson into ostracizing his daughter and grandchildren, who have long been the heirs apparent to the a more-than $2 billion business empire that includes the two pro teams, auto dealerships, a television station and real estate.
After a trial that was closed to the public, a Judge Kern Reese ruled that while Benson sometimes exhibited the forgetfulness or impairment that is common among people his age, he remained aware of the consequences of his actions and therefore fit to continue overseeing his own affairs. Appeals of that decision to higher state courts were rejected, and transcripts of the trial have never been made public in any form.
Once that case was decided, Benson was firmly in position to remain in control his professional teams because he'd never placed voting shares of his clubs in the trusts.
Still, Benson sought to avoid a scenario whereby he and his wife would be saddled with hostile minority owners.
The settlement should end much of the uncertainty that has surrounded the NFL and NBA teams since the Benson family split a year-and-a-half ago - at least as long as Tom Benson is alive.
However, the estranged heirs have stated publicly that they will not give up their effort to prove that their patriarch has been unduly manipulated, and to repair their relationship with him. They have even made a public plea asking anyone with information that could prove their assertions come forward, perhaps laying the ground work for the spurned heirs to contest Tom Benson's will in court after his death.
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