Showing posts with label Detroit Pistons. Show all posts
Showing posts with label Detroit Pistons. Show all posts

Wednesday, March 28, 2012

When Broken-Down Celebrities Cannot Pay Child Support Obligations: Dennis Rodman

Former Piston &
Hall of Famer Dennis Rodman
Just last August, I waxed nostolgically when I read that former Detroit Piston Bad Boy Dennis Rodman had been inducted into the NBA's Hall of Fame.  He earned that distinction by contributing to five NBA championship teams; two with the Pistons, and three with the Bulls.

Fast forward a few months, and here was Rodman's pro bono lawyer explaining to a family court judge, then to the press, that the man was broken down, sick, unable to earn the millions he did in the days of yore and thus, unable to pay his child support obligations.

According to the LA Times, his child support arrearage for two children is fast-approaching one million dollars.

As a Special Assistant Attorney General assigned to prosecute felony child support cases, I've seen a few professional athletes pop-up as criminal defendants with eye-popping arrearages.  These cases highlight the peaks and valleys characterizing the income history of many star athletes.

The basic problem is that these superstars show multi-million dollar income, but for a very short period of time.  Many of them spend the dough on a lavish lifestyle rather than save and when it all comes to a crashing end, they fail to seek an adjustment of their support obligation in the family court; hence the whopping arrears.

Rodman's case was different; he was able to take his insane schtick to the bank for years following his NBA earning years.  Now that he has aged and is reportedly ill, all that has gone away.

Here in Michigan, child support is controlled by the Michigan Child Support Formula; literally an algorithm taking into account the relative income of the child's parents, as well as the overnight parenting schedule.

Like Michigan, some states have adopted support formulas that "top-out" for high earners. Here in Michigan, for example, child support can only be calculated for an annual income of $422,916 or less.

In addition, the MCSF takes away most of the court's discretion in setting child support. Absent compelling factors, support is determined through a straight-forward application of the MCSF.

In the case of some high-earning payors, litigants have cried foul, asserting that when a parent earns millions of dollars, his children should share in that wealth. This is particularly the case where the high income is short-lived; like with most professional athletes.  Rodman's income went on for much longer than most.

Like Michigan, Florida, Nebraska, Virginia, West Virginia and Wyoming all use a straight formulaic approach [with a cap] to the calculation of child support. Other states utilize a percentage approach where the child support obligation just keeps going up; keeping pace with the parent's high income.

Recognizing this problem, some states have specific statutes that address high income households. These statutes usually provide the family court judge with some good old-fashioned "discretion" to determine the child support obligation in accord with the "best interests of the child."

It will be interesting to see whether the family court judge will give Rodman a break and reduce his child support.  But arrearage is arrearage; due and owing to his two children.

We cannot help but wonder, over the past several years, whether Rodman spent his fortune on himself rather than taking care of his children.

http://www.waterfordlegal.com/

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Sunday, September 5, 2010

Huge Claims Resolved in Davidson Estate

When you die a billionaire, your estate is often going to be heavily litigated before a certificate of completion is filed with the probate court.  Particularly when your widow (and business partner) is not the mother of your children.

Another ingredient for guaranteed protracted probate litigation: last minute changes to your will.

Local billionaire Bill Davidson's estate had all of these characteristics.  After his death in March 2009, Davidson's estate was estimated at well-over a billion dollars.

Davidson parlayed his fortune from Guardian Industries, a glass company, into a sports empire that once included world-champions Detroit Pistons and Detroit Shock, as well as the Tampa Bay Lightning hockey team, and the Detroit Fury arena football team.

The estate and the $20 million claims filed against it, first denied but then eventually settled, are all on file with the Oakland County Probate Court.  The terms of the settlement, however, are not.

Apparently, the problem arose when Davidson made changes to his 19-page will during the last week of his life.  Those testamentary amendments broke-up Davidson's estate into three separate trusts and named his wife, a son and a daughter, all Bloomfield Hills residents, as the sole beneficiaries.

The probate litigants pitted Davidson's spouse and owner of the Detroit Pistons, Karen Davidson, against his son and daughter.   The dispute involved claims against the estate filed by Milestones Upgrading & Industries Co., an Israeli company, and Big Ben Investments; companies with which Mr. Davidson had a long business-relationship.

The claims filed by Milestones and Big Ben alleged that Mr. Davidson made up to $20 million in investment pledges to the companies.  Karen Davidson, listed as a manager for Big Ben, wanted her husband's estate to honor the pledges, saying they were consistent with Mr. Davidson's testamentary wishes.

In collateral "breach of contract" litigation assigned to Oakland Circuit Judge Nanci Grant, the corporate plaintiffs also privately settled the circuit court disputes via stipulated orders of dismissal in July.

While these large probate and circuit court disputes were being negotiated and resolved, you may recall rumors that Karen Davidson was shopping the Detroit Pistons for an interested purchaser.  Fortunately, the Davidson Estate has enough money to resolve the expensive claims made against it and to apparently keep the Pistons right where they are; in the suburbs of the "D".

info@clarkstonlegal.com

www.clarkstonlegal.com

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